Tebogo Moopa

Our asset allocation team recently conducted it’s monthly asset allocation review. The committee remains cautiously optimistic on asset class returns for the next 12 months.

We have a moderate overweight towards local equities as well as global equities, including emerging market equities. We believe that certain global macroeconomic Factors, such as recent Chinese and German fiscal stimulus, plus dollar weakness, could be supportive of decent earnings growth over the next 12 months. 

That said, we have tempered our conviction on growth assets because of geopolitical tensions (mainly trade wars). We maintain our underweight to SA property and would rather take our duration bet via SA bonds and SA inflation-linked bonds (ILBs). SA bonds are still offering compelling yields, despite our recent SA Budget. 

We maintain our neutral stance on global bonds but are deliberating on increasing global ILBs from negative to neutral.