InPerspective caught up with Rehana Khan, Portfolio Manager in our 4Factor team, on her career journey, navigating markets during a pandemic, her views on diversity and her greatest inspiration.
1. You began your career as an article clerk. How did your journey evolve into portfolio management and what have been career highlights thus far?
The aspect of my articles that I enjoyed most was the interaction with the various business management teams that we audited and understanding how these businesses made money, as opposed to the tick box and checking duties of an auditor. Auditing did not provide the challenges I needed but it did help me develop an understanding of various business models and provided the opportunity to interact with top company management very early on in my career. This turned out to be a great foundation for my investment career.
After my articles, I became a manager at Deloitte in their Special Services Division. One of my assignments was filling in for a financial manager at a small boutique asset manager. This was my first introduction to the asset management industry. I spent a couple of months there and during this time one of the portfolio managers inspired me with his love and passion for asset management. It piqued my interest and I decided to do a bit more research. This is where the curiosity for this industry started for me. I joined the industry in 2008.
In the early years, I remember reading extensively in the evenings and over the weekends. Books, articles, newspapers, broker research papers and more – I was determined to build up my knowledge about investments. (I’m still like this, nothing has changed, actually!)
I was fortunate to have two great mentors early on in my career. They recognised the potential in me and allowed me the opportunity and space to develop my own investment style.
Throughout my life, I’ve learnt to love a challenge and I have a fighting spirit. When it’s something I enjoy, it becomes an extension of my day-to-day life. That’s what my job in investments has become for me. I enjoy the challenge of the markets and the way it keeps me humble. It suits my personality as I have always been willing to take risks, accept and adapt to change and admit mistakes.
There is never a dull moment in the markets!
2. You joined Ninety One this year and currently have portfolio management responsibilities for SA Equity and Balanced strategies as well as the wider 4Factor research platform. What do you enjoy about your role?
At Ninety One, I have been given the opportunity to broaden the scope of my portfolio management responsibilities into global equities. I am thoroughly enjoying the challenge of global markets as well as the truly global nature of the business. It’s been a privilege to leverage off the global teams’ research platform and capabilities and assist in fulfilling the completion method of investing in the South African global multi-asset portfolios. Ninety One offers something unique in the South African asset management landscape.
I am energised and enjoy the interaction and new relationships formed with the South African 4Factor team and the broader debates and discussions that take place with members of the Quality and Value teams.
Ninety One is definitely living up to what Hannes van den Berg (co-Head of SA Equity & Multi-Asset) described in our initial discussions: “It’s a place where adults come out to play.”
3. Financial markets are very volatile and COVID-19 has created a lot of uncertainty. What are your views on the markets?
Where do I start? I could write a novel! But I will try to be brief.
Markets are a funny thing. While over the longer term, the earnings ability of the company drives a big chunk of the return, over the shorter term, factors like liquidity and sentiment/positioning also have a role to play – and even more so at inflection points. Thus far in 2020 (merely 6 months into the year), we have gone from one of the quickest market corrections in history to one of the quickest market recoveries in history.
Trying to beat the market is a challenging endeavour. COVID-19 has of course made it even more so with the mountain of uncertainty it brought forth. Commentators and writers have drawn parallels with previous market sell-offs, such as the Great Depression, the dot-com bubble and the GFC. While it shares some characteristics with many of them, recent events are unique.
The lockdown of countries globally has led to demand and supply shocks, with many companies experiencing zero revenue over the period. Central banks and governments globally have acted faster and the sheer scale of the stimulus provided surpasses any previous crisis. The aim is to ensure that there is enough liquidity in markets to keep functioning while providing businesses and consumers with some financial help in order to survive the crisis. The big unknown is how much permanent scarring is left behind post the crisis.
The next decade is going to be interesting for markets as we grapple with the aftermath of all the policy stimulus (are we headed into a fiscal stimulus world? Does this lead to rising inflation, which has been absent for so long? Does the value investment style have a chance of a comeback?), debt overhang (do over-indebted governments have to deflate their debt? Or will there be debt forgiveness?) and not to mention demographic shifts (ageing populations in the developed world leading to an interesting change in dynamics).
I am really looking forward to navigating through all these potential scenarios with the teams at Ninety One and ensuring that we invest our clients’ money to our best ability to protect and grow it over time.
4. Portfolio management remains a very male-dominated world. What has been your experience?
There are still very few female portfolio managers in South Africa, as the pace of women climbing the ranks in the industry has been very slow. Female representation on investment teams tends to be greater in the analyst-type roles.
The lack of females occupying more senior roles is not limited to investment management but speaks to traditional gender stereotypes perhaps still being prevalent. This is a complex issue, but with society evolving we are seeing a gradual change. The challenge is to continue breaking down these barriers of perception, and to continue demonstrating through one’s output that you are more than capable of competing on a level playing field.
In my experience, it has perhaps meant having to work harder upfront to be recognised. I have needed to make sacrifices along the way at different points in time. I’ve enjoyed the challenge and where I’ve needed to juggle a few balls at a time, I’ve thankfully had a very supportive husband and parents, who have helped tremendously. I consider myself fortunate to have had mentors early in my career who acknowledged my effort, encouraged me and challenged my thinking. This was the breakthrough that allowed me to push through and achieve my goal of becoming a portfolio manager.
5. What does diversity mean to you?
Diversity is what makes us unique. This could either be on the surface, such as age, race, gender or at a deeper level such as one’s political or religious beliefs.
I think these differences add layers of complexity but more positively, great opportunity. As an individual, embracing your own uniqueness and using it as a strength and not a weakness, will allow you to elevate yourself and those around you. I believe we should all take responsibility and help each other leverage off our strengths in both our personal and professional lives.
Embracing diversity can give an investment team a powerful and dynamic edge. Think about it: various views and thought processes are brought to the table, debated and discussed in a robust manner, ultimately enabling the team to see the full picture.
6. Who has been an inspiration to you?
My parents are my greatest inspiration. They come from humble beginnings. There is a narrative in society that if you are born into poverty it is very hard to break that cycle and rise above it. My parents proved that wrong. Despite the adversity they faced, they were determined and motivated to change and improve their circumstances. They taught me and my siblings the importance of education, dedication, perseverance, and honesty and how with these traits anything is possible.
My siblings and I are the living image of that realisation.
7. What would you tell your teenage self?
Hard work and sacrifice do pay off in the long term. Don’t let your social circumstances or history determine who you are and what you are able to achieve.
And most importantly, you are not always going to be perfect and get everything right. It’s okay to fail. It sharpens your survival instincts and forces you to learn. It’s all about how you come back from those setbacks and what you learn from them that matters. So, do not be afraid to take advantage of all the opportunities presented to you, or to pursue opportunities that interest and challenge you. You can only make an informed decision once you have given it a proper shot.
In the words of Niki Lauda when he received an award at the 2016 Laureus Awards and dedicated it to all the losers, “Winning is one thing, but out of losing, I always learnt more for the future, so I got a lot stronger from losing.”
8. What are you passionate about?
Apart from the markets, I am passionate and energised by my family, close friends, travelling and making a difference in the lives of people less fortunate that I am.
I am enthusiastic about being a mentor to those keen to learn. I enjoy challenging their thought processes, which allows them to break through their conventional boundaries. I learn a lot from this too and it gives me great pleasure watching those around me develop and ultimately achieve their goals. I see it as a reflection of my own journey with my mentors and an opportunity to inspire others.
Spending time with my family energises me (well, most of the time!). I have been blessed with three amazing kids and have a very supportive husband. For me there is nothing more rewarding than our family holidays where we spend quality time exploring new places while experiencing different cultures.
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