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The greatest con artists in the business world have three traits in common.
They are charismatic, a little bit enigmatic, and ultimately problematic, says Deon Gouws, chief investment officer at London-based Credo Group UK.
In a presentation at the Investment Forum in Cape Town on Thursday, Gouws made the case against professional investors going to great lengths to meet the senior management of companies.
"It can be dangerous and it is probably a waste of time."
Citing historical data from a survey among US chief financial officers, Gouws showed that executives are usually over-optimistic about the prospects of their own companies.
But more than that, charismatic executives can lead asset managers astray.
"I think you're going to be influenced by the overoptimism and potentially the deception of management."
Taking the example of Steinhoff's disgraced former CEO Markus Jooste, Gouws said, in person, he had a strong personality that swayed asset managers. "He was extremely charismatic, he was very convincing." Most analysts who met him "lapped up" his Steinhoff narrative.
Citing a list of other entrepreneurs – including Elizabeth Holmes (who convinced some of the world's foremost investors that hundreds of health tests could be gathered from just one drop of blood), Adam Neumann (charismatic founder of the bankrupt co-working group WeWork) and Sam Bankman-Fried (once-famed crypto "visionary" founded guilty of fraud) - Gouws said they were successful because they were so believable and impressive in person.
A company's track record of delivery should be all that counts, he contended.
Ultimately, "you should invest in a business that even a fool can run, because someday a fool will", Gouws said, quoting Warren Buffett.
This is true for countries as well, said Gouws, drawing a parallel to the US, where controversial former president Donald Trump has a strong chance of getting his job back in the November election.
Gouws made a case for dollar and US investments and said fears about US debt are overblown, with the massive growth in the country's assets being ignored.
So, while the US's debt per person has grown to more than $100 000, the US now has national assets equal to more than $560 000 per individual. The US economy continues to be the most dynamic in the world, delivering some of the best-performing companies - and the country's energy independence is a major advantage.
A dollar bull, Gouws says the US currency still represents almost 90% of forex transactions in the world – with other currencies and countries not nearly as appealing.
News24 is a media partner of the Investment Forum.
