R1million showdown: Viljoen leads, Heystek closes in

BizNews founder Alec Hogg checks in with Piet Viljoen and Magnus Heystek as their four-year Million Rand investment face-off nears its conclusion. Viljoen’s local-value strategy holds a narrow lead, but Heystek’s offshore picks are closing fast. With 16 months to go, the race reveals hard truths about markets, fund managers and the surprising resilience of SA equities..Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox at 5:30am weekdays. Register here.Support South Africa’s bastion of independent journalism, offering balanced insights on investments, business, and the political economy, by joining BizNews Premium. Register here.If you prefer WhatsApp for updates, sign up to the BizNews channel here.The auditorium doors will open for BNIC#2 on 10 September 2025 in Hermanus. For more information and tickets, click here..Watch here:.Listen here:.Highlights from the interview.The Million Rand Challenge - one of the most talked-about investment experiments in recent years - is heading into its final 16 months.Launched nearly four years ago by a member of the BizNews Tribe, the challenge offered R1 million in real capital to finally test the age-old debate: local versus offshore. Each manager received R500,000 to invest according to their core strategy. Piet Viljoen, founder of RECM, backed undervalued South African equities through the Merchant West Value Fund. Magnus Heystek of Brenthurst Wealth, a long-time offshore advocate, spread his bets across global markets.This week, BizNews founder Alec Hogg sat down with both managers for a progress check.Viljoen’s fund has grown to R627,941 - a 26 percent return. Heystek’s portfolio, which stumbled early as offshore markets took a hit, has rallied to R595,872 - up 19 percent.Viljoen remains committed to his thesis: South African assets are deeply discounted, pricing in corruption, dysfunction and political instability. Any modest improvement - whether from better governance, stronger commodity cycles or a global shift away from the US dollar - offers “positive optionality.”“If there’s a little bit of good news,” Viljoen said, “you can make a lot of money. If nothing improves, you still earn strong dividends from solid businesses at low valuations. I like those odds.”Heystek credits much of his recent recovery to smaller, agile fund managers like Sean Peche at Ranmore, who made timely bets - including a high-return move into a discounted South Korean brokerage. The offshore fund also saw upside from Ninety One’s European equity portfolio, particularly with defensive stocks in Germany.“I started off trying to do too much - too much trading, too many switches,” Heystek admitted. “Now I’m letting the fund managers run. I’ve got a strong offshore blend and I’ll make only small adjustments based on things like the dollar story.”.Read more:.BN Briefing: Bain bows out of SA, Trump turns up the heat, and Trollip vs O’Sullivan escalates.Both agree that South Africa’s top equity funds have become index-huggers - dominated by the same handful of mega-cap stocks like Naspers and Prosus. In contrast, Viljoen’s value fund leans into mid-cap counters like Sabvest, Argent and Lewis - companies that large managers often overlook.“The reality,” said Heystek, “is that most of our top ten local equity funds all look the same. You’re just buying the index minus two percent.”What’s surprised both managers - and much of the investment community - is how well South African equities have performed despite dire headlines: expropriation threats, a failing rail network, political chaos and rising crime. Since January last year, the JSE has outperformed the S&P 500 and kept pace with the NASDAQ.“The stock market isn’t the economy,” said Viljoen. “It’s forward-looking and it’s already discounted most of the bad news.”There’s also the currency wildcard. While many predicted the rand would collapse under mounting political pressure, it has instead been buoyed by a sharply weaker US dollar - a trend Goldman Sachs says could mark a structural shift in currency dynamics.Viljoen, however, isn’t betting outright against the dollar.“The US is heavily indebted, sure - but betting against it hasn’t worked for decades. That said, developed markets are starting to behave like old-school emerging markets. There’s risk there.”With 16 months left, the scoreboard still matters - but both managers see the bigger picture.“This isn’t about one fund beating another,” said Alec Hogg. “It’s about showing South Africans what true active investing looks like - the trade-offs, the temperament and the thinking behind every move.”In the end, whether Viljoen’s value filly gallops home or Heystek’s Secretariat kicks in late, this challenge has already done its job: it’s forced two of the country’s top money minds to make real-world calls, with skin in the game and the full glare of the BizNews Tribe watching.And the finish line is getting closer.

R1million showdown: Viljoen leads, Heystek closes in

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