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: April 2025

Global markets were exceptionally volatile in April, as the implications of US trade policy impacted stocks, bonds, and currencies, but most non- US markets closed in the green for the month as investors diversified into regions that were likely to be less affected by tariffs.

In the US, inflation declined from 2.8% to 2.4% year-on-year as a smaller increase in shelter costs and lower fuel prices offset continued increases in the price of food. US GDP meanwhile declined 0.3% in the first quarter as imports surged 41% in the quarter – the biggest increase since the pandemic – as retailers stocked up prior to the implementation of tariffs, and domestic activity slowed in the back of increased uncertainty. While the sharp decline in US GDP supports rate cuts (the market is pricing in four rate cuts for the year), an expected reacceleration in inflation will give the Federal Reserve reason to pause. US data released in April showed signs of further economic moderation with the soft data (surveys) leading the hard data in predicting a slowdown. Business expectations and consumer sentiment fell to levels last seen during the pandemic and the trajectory is matching the pattern seen in past recessions that were triggered by a clear shock. A shock to confidence is hindering investment and spending decisions, increasing the risk of a recession by the end of the year. Hard data such as consumer spending appears to be holding up, but this could be due to factors such as consumers front-running tariffs which props up activity now but potentially creates a demand vacuum in the next few months. Export orders have meanwhile slowed from areas like Canada and Mexico that faced tariff uncertainty earlier than other US trading partners, while surveys from the shipping industry suggest a sharp slowdown in exports from China is imminent.

A severe equity market sell-off early in the month saw the US’ S&P 500 losing 6.7% the day after “Liberation Day” when President Trump announced a set of tariffs that were broader and more punitive than expected. Markets however recovered most of their losses after President Trump announced a 90-day pause in the implementation of reciprocal tariffs for countries that had not yet adopted retaliatory measures, and the removal of tariffs on a range of electronic products. The MSCI World Index ended the month up 0.9% with US markets underperforming most of their global peers. The S&P500 ended the month with losses of 0.7% while Germany’s DAX and Japan’s Nikkei Index gained 1.5% and 1.2% respectively. Emerging markets gained 1.3%, as losses in China were offset by solid returns from Mexico, Brazil and India in particular. The confidence shock triggered by the “Liberation Day” tariff announcements also affected the bond markets with the yield on 10-year US Treasuries reaching a peak of 4.6% on 11 April, before settling at 4.2% by the end of the month. A stronger yen and euro helped global bonds gain 3% for the month while global property stocks gained just 0.4% as fears of a US recession dampened confidence in the sector.

In South Africa, the ruling party scrapped the proposed VAT increase as they faced intense pressure from opposition parties and business groups. Without the VAT increase, the Finance Ministry estimated that revenue will be R75bn lower over the medium term, and Parliament will have to adjust expenditure in a manner that ensures that the loss of revenue does not harm South Africa's fiscal sustainability. Inflation meanwhile declined from 3.2% year-on-year in February to 2.7% in March as fuel prices softened on the back of lower oil prices. While inflation remains low, the Reserve Bank is unlikely to cut interest rates in May as global risks remain to the upside. Meanwhile, a deterioration in business conditions amid increased uncertainty led to a decline in new orders and reduced manufacturing output. Mining production also fell sharply, driven by declined in platinum, coal, gold, and coal production. Consumer spending also fell sharply, down 1.3% year-on-year in February, as consumers struggle to recover from the festive season. The slowdown in consumption and business activity is expected to weigh on Q1 GDP and the IMF has downgraded their forecast for 2025 growth to just 1% - far lower than National Treasury’s 1.9% growth expectation.

Local equity markets benefited from higher gold prices, a weaker rand, and the stabilisation of the local political environment. The All Share Index gained 4.3% for the month (+10.5% year-to-date) as the 5% gain in Industrials stocks and the 4.8% gain in Financials stocks offset relative weakness Resources stocks (+2.1%). Industrials were driven higher by gains in retailers and rand-hedge stocks like Naspers and British American Tobacco while banks gained on the back of solid earnings growth. Capitec became the country’s most valuable bank by market capitalisation as their share price gained 15% after reporting earnings growth of 30% year-on-year. Resources stocks benefited from record gold prices which passed $3500 an ounce, but lower prices for other commodities including platinum, oil, and coal dampened returns for the sector. Financials eked out a small gain as gains in banks offset losses in life insurers. The rand weakened 1.6% for the month despite a weaker dollar as deteriorating sentiment towards the GNU, and potential trade disruptions with the US, dampened investor sentiment towards the currency. Local bonds gained 0.8% for the month as the nation’s deteriorating debt-to-GDP trajectory weighed on sentiment. Listed property stocks however surged 7.6% in April as investors priced in interest rate cuts on the back of sharply lower inflation.