Investments

Life stage (default)

The fund applies a life stage model which automatically takes members through different investment portfolios i.e. aggressive to more conservative portfolios as they near retirement age. The life stages are as follows:

Members younger than age 55 - Aggressive Growth portfolio
Members age 55 and older, but younger than age 62 -Capital Growth portfolio
Members age 62 and older - Stable Growth portfolio

The fund has implemented a phasing-in approach for default switches. Read more

The first 25% switch to the new recommended portfolio will commence at the end of a member’s birthday month. As a result, it will take 12 months for a total portfolio switch to be completed. After the 12 month phase-in period, all future member contributions will automatically accrue to the new default life stage portfolio. See an illustration of a default switch from the Aggressive Growth portfolio to the Capital Growth portfolio below.

*The first 25% switch to the new recommended portfolio will commence at thee end of a member's birthday month.

Member investment choice

The fund also allows flexibility in providing our members with the option to elect any of the individual investment portfolio options available.
Investment switch form

Aggressive Growth Portfolio

Investment objective: To maximise capital growth over a long-term investment horizon. Members should acknowledge that this strategy could deliver volatile and negative returns over the short-term. This strategy is suitable for members with more than 10 years to retirement.

Capital Growth Portfolio

Investment objective: :To target capital growth over a medium to long-term investment horizon. Members should acknowledge that this strategy could deliver volatile and negative returns over the short-term. This strategy is suitable for members with 5 to 10 years to retirement.

Stable Growth Portfolio

Investment objective: To target stable returns over a medium-term investment horizon with low volatility and a low probability of negative returns. This strategy is suitable for members with 1 to 5 years to retirement.

Capital Protector Portfolio

Investment objective: To provide capital security with very low volatility and an extremely low probability of negative returns. This strategy is suitable for members with less than 1 year to retirement where capital protection is absolutely necessary

Shari’ah portfolio

This portfolio is suitable for Muslim investors requiring a Sharia-compliant investment portfolio. The portfolio will be invested in a variety of domestic and international asset classes. The underlying investments will comply with Shari'ah requirements as prescribed by the Auditing Organisation for Islamic Financial Institutions. The portfolio targets capital growth over the long-term while limiting short term market fluctuations.

Latest investment returns

Economic Commentary: Nov 2024

Euphoria surrounding Donald Trump’s election victory, premised on making America great again, drove developed markets sharply higher in November, while emerging markets declined as fears of US-centric economic policies weighed on sentiment.

Despite strong consumption activity in the US and inflation that remains above the Fed’s 2% target, the Fed is still widely expected to cut interest rates in December as it appears the labour market is softening, and business spending has slowed. The Atlanta Fed is forecasting gross domestic product increasing at a 2.7% rate in the fourth quarter and data from Adobe Analytics showed consumers have in the first 24 days of November spent $77.4 billion online, up 9.6% on a year-on-year basis. Activity is however divided between those the Mastercard Economics Institute describes as "the value-conscious consumer who feels stretched by economic pressures," and "a confident consumer who feels free to spend." Indeed, consumers are increasingly using home equity loans to fund consumption as house prices have risen and mortgage rates were fixed at record low levels. Officials too appeared divided over how much farther they may need to cut rates, and further rate cuts are not guaranteed given that the implementation of President-Elect Trump’s promised 25% tariff on all products from Mexico and Canada, and an additional 10% tariff on goods from China, would likely increase inflation by 0.9%.

Global developed markets soared in November as the “Trump trade” gathered steam. The MSCI World Index gained 4.6%, driven by outsized gains in the US as Trump’s “MAGA” policies were expected to invigorate US economic activity. The US’ S&P 500 surged 5.9% supported by large gains in industrial, financial and consumer discretionary stocks. Energy stocks gained over 7% despite the lower oil prices as Trump’s support of the oil and gas sector was expected to improve profitability, and the increased demand for electricity from data centres renewed investors’ interest in energy companies. Emerging markets bore the brunt of the rotation to the US and declined 3.6% as investors feared that Trump’s US-centric rhetoric would ultimately result in a slowdown in economic activity in export-led economies, while lower commodity prices negatively impacted commodity producing nations like South Africa, Indonesia and Brazil. Global bonds gained 0.3% in November as yields on developed market government bonds were largely unchanged in the month despite expectations that Trump’s policies, especially tariffs in imported goods, may well be inflationary. Global property stocks rose 2.7% as the sector benefited from the rise in developed market stocks and stable bond yields.

In South Africa, annual inflation dropped to 2.8% in October (from 3.8% in September) as significantly lower transport prices (down 5.3% year-on-year) offset price gains in housing and utilities, food, and beverages. Manufacturing production declined 0.8% year-on- year in September, but activity is expected to increase as electricity production and logistics improves. Retail sales slowed in September, with sales rising just 0.9% year-on-year, as high interest rates put pressure on discretionary spending. New vehicle sales however increased to a five-year high in October as the domestic market shows signs of recovery, suggesting that overall consumption should also improve. Exports of new vehicles however dipped as stricter emissions regulations in Europe, and an influx of vehicles from China dented export sales. The SARB’s Monetary Policy Committee meanwhile cut interest rates by 0.25% at the November MPC meeting, seemingly following the US’ conservative approach despite inflation that is well below the SARB’s target. South Africa posted a surprise trade surplus of R14.6bn in October as exports exceeded imports for the month.

Local equities declined further in November with the All Share Index losing another 0.9%, led by losses in resources stocks. Financials and Industrials eked out marginal gains with Industrials benefiting as gains in retailers and British American Tobacco offset weakness in Naspers and losses in the automotive, telecoms, and healthcare sectors. Resources stocks fell 7% as PGM miners gave back the previous month’s gains and oil and chemical stocks fell on lower oil prices. The rand weakened c. 2.5% along with most other emerging markets to end the month at R18.06 to the dollar. Local bonds gained 3.1% for the month as yields declined steadily through the month as investors priced in lower inflation. A surprise change in S&P Global Ratings’ country outlook from “stable” to “positive” mid-month further supported local bonds, with the 10-year government bond yield falling to 9.1%. Listed property stocks gained 1.7%, as investors reacted to the lower funding costs and improving sentiment.