Who is Marco Visentin?
An electrical engineer and professional project manager who has worked all over the world on projects and is currently with Anglo American, Marco Visentin has seen many business sectors from the inside: financial services, mining, industrial and manufacturing.
Marco’s portfolio of equity investments
“I manage two portfolios entirely invested in equities, except a 25% holding of cash in terms of the mandate of one of them. I am heavily weighted towards the mining sector (12%), with Lonmin, Impala Platinum, BHP Billiton, ZCI and Anglo American. In addition, I believe all portfolios ought to have the five ‘Rs’: Richemont, Remgro, Reinert, RMI and RMB Holdings.
I also favour media (11%): Caxtons and Avusa, with the over-the-counter traded Element One (which owns Caxtons). In industrials I have SABMiller and KAP Industries; in financial services I have Liberty; in telecoms, Telkom; and property companies African Overseas and Monteagel.
How did you select these companies and what do you look for as an investor?
I am self-taught and developed my strategy by reading financial newspapers and magazines and asking lots of questions. The investment philosophy that I have developed is to buy bricks and mortar companies that have historically performed very well through various economic cycles, are cash flush, and have healthy debt:equity ratios and internal rate of return. They must also have strong management and pay healthy dividends.
Once I have found companies that meet these criteria, I study their financial reports looking at their future prospects and strategy. I do the same things that any asset manager does, including looking at companies that are morally and ethically correct and therefore sustainable.
My only costs are JSE transaction fees, and I take a long-term investment horizon of five to 10 years. I rarely sell but reinvest all the gains, including dividends, back into the portfolio.
I handle the volatility of the market by buying into good companies whenever they demonstrate value, and having the patience to know the shares will recover if they fall.
However, mining shares are trading stock and l sell whenever there is a selling opportunity and buy back in whenever there is a buying opportunity. In the case of Telkom, it’s a cash cow and the backbone of the ICT infrastructure in this country.
My choice of Caxton and Avusa is based on the expectation of corporate actions. Corporate actions and dividends amount to a substantial component of the return on investment, possibly as much as 40%.
What returns have you had to date?
My objective when investing is to better the rate of CPI by 15%, and because the companies I have selected all pay very healthy dividends, I have achieved a return of 27% over the past decade.