Firing line  

‘Where assets appear cheap there is a good reason for it’

And even with Amazon facing a threat of a breakup from Trump’s administration, all these risks have not made Mr Smit averse to seeking investment in the technology sector.

He is interested in businesses with a genuine long-term strategy and a focus on diversifying.

“Google has satellites and driverless cars. Their recent topline [organic growth] in currency terms was up 20 per cent; that’s close to a quarter on a very high base,” Mr Smit added.

Other businesses he likes are Visa and Accenture, particularly due to the digital transformation work the consultancy firm is doing with businesses and its investment into artificial intelligence.

In healthcare, Mr Smit typically keeps away from businesses with higher legal risks and where there is a danger their product will become uncompetitive, as is seen with human drugs.

For example, a company may introduce a new blockbuster drug, but the patent will have a time period, after which the formula is opened up to the rest of the market, making the drug cheaper.

The part of the healthcare sector Mr Smit is more interested in is animal drugs.

He said: “In animal drugs you don’t sell as many drugs to the government, so you don’t have the concentrated buying power, which immediately lightens the pressure on margins.

“It is a fraction of the [legal] risk that you have with human drugs. [Additionally] as wealth improves anywhere in the world from a relatively low base, those people eat more meat, drink more milk and those products encourage animal farming [and more] drug sales.”

The perceived growth in animal drugs is 4.5 per cent against 3 per cent for humans.

But one philosophy certainly not on Mr Smit’s list is taking a higher risk to have a fair return.

He added: “You get fair return by acting responsibly and focusing on sustainability and quality, and not trying to outguess cycles.”

Ima Jackson-Obot is a features writer of Financial Adviser

Career highlights:

2008 – Present - Partner, head of equity management, Stonehage Fleming

2002 – 2007 - Partner, head of research, boutique asset manager, ACPI Investment Managers

2000 – 2001 - Head of global balanced portfolios, Sanlam Investment Management

1996 – 1999 - Chief investment officer, portfolio manager, Sanlam International Asset Management

1993 – 1995 - Chief investment strategist, Sanlam Asset Management

1980 – 1992 - Junior/chief investment analyst (and corporate actions analyst), Sanlam Asset Management