It’s been a challenging, surprising, unpredictable year. Are there things investors could have done differently? MoneyMarketing asked three industry experts about their experiences in 2024.
Mike Adsetts, Global Chief Investment Officer at Momentum Multi-Managers
The biggest takeaway from 2024 is reflecting on the significant challenges the year brought. Many of these risks were somewhat anticipated as early as the beginning of the year, but while they were identified, no-one knew how they would transpire. The discussion initially focused on whether a recession was looming for the US economy. However, as the months passed, the narrative began to shift toward the possibility of achieving a ‘soft landing’. This led to debates and differing viewpoints, with the central question being whether there were sufficient economic indicators pointing to a feasible soft landing.
Inflation was another critical issue, continuing to run at elevated levels, causing concern across markets. The initial outlook for 2024 included the expectation that interest rates in developed markets might ease. However, the pace and timing of such rate cuts were still uncertain, with central banks being cautious. The anticipation and response to these evolving conditions highlighted the delicate balancing act central banks faced throughout 2024.
The two elections – South African and US – were always going to be key economic indicators. We were hesitant about the impact of local elections on the markets. It created a difficult situation because South African assets were undervalued but if the results of the election were unfavourable, the risk was that yields would spike up, the rand would weaken, and local equity markets would continue to be under pressure. We positioned our portfolios to be a bit underweighted in South African assets because we were concerned about the outcome of the local election, but it was a little bit moderated. Where we did have an underweight, it wasn’t a big underweight. We were cautious. After the elections, the markets rallied quite strongly as the outcome was better than any of us had anticipated.
The US election also brought some surprises. While the presidential race was always too close to call, no one predicted the total red wave that emerged. Trump is known as being an unpredictable president, and will probably be a very unpredictable president this time around, looking at the appointments he’s made to date. There’s also a view by some in the US that Trump will be more interventionist in the Federal Reserve, but that remains to be seen.
We don’t foresee the dollar losing its status as the global reserve currency. There’s no real potential replacement for the US dollar as a reserve currency in the near, medium and even a couple of decades into the future. We will, however, probably start seeing deglobalisation to a point that it’s replaced by regionalisation. As America becomes more protectionist, other contenders see an opportunity for themselves to stake a place in the world.
Another thing that surprised us in 2024 was the strong performance of listed property locally. It had a strong run up until the end of last year, so our view was that it was starting to get overvalued. However, it continued to rally over the year, being the best-performing sector by far.
Duggan Matthews, Chief Investment Officer, Marriott Asset Management
The biggest challenge this year was dealing with a constantly changing macro environment. It’s not just a 2024 issue; it’s been ongoing since Covid. This makes predicting market behaviour extremely tough. It reinforced for us that investment strategies based purely on predictions can lead to high anxiety and random outcomes. So, we focus more on maintaining a long-term perspective rather than reacting to short-term changes.
History shows us that unpredictable events happen. This reinforces the importance of a long-term mindset. Trying to chase trends or react to immediate concerns can lead to poor decisions. We avoid being reactive to the uncertainty, staying anchored to our investment philosophy, which focuses on long-term outcomes rather than trying to predict random events.
There have been positive impacts from the recent political changes in South Africa, which is a relief. However, we remain cautious because the GNU is still new and not very robust. We need to factor in that this political arrangement might not be stable long-term, so we keep this in mind while constructing portfolios.
We were more cautious this year because of global uncertainties. There’s always pressure on asset managers to outperform, but taking big, speculative bets can be risky in such unpredictable times. It’s important to have a clear, long-term strategy and not rely solely on predicting uncertain outcomes.
The market reaction to the US election has been positive, especially for US stocks, and we have a healthy exposure to them.However, small-cap stocks have seen the most significant gains, and we haven’t heavily invested in that sector. It’s still early, and predicting the full impact of this election on the market is difficult. We prefer to remain cautious and focus on the long-term view.
Geopolitical issues are hard to predict. Our approach is to focus on building resilient, globally diversified portfolios that can withstand different scenarios. It’s about ensuring our investments are robust enough to handle unexpected shocks.
The market has become more reactive, especially with the rise of AI and algorithmic trading. The average holding period for US stocks is now less than six months, indicating a shift towards short-termism. We invest in high-quality, resilient companies and hold them long-term to avoid short-term volatility. In 2025, with ongoing geopolitical tensions and economic uncertainties, our strategy remains focused on tuning out the noise, maintaining a long-term view, and constructing robust portfolios.
Hildegard Wilson, Head of Investment Solutions at Glacier by Sanlam
One of the most significant challenges in 2024 was the rapid shift in product mix, moving from protected or guaranteed products to market-linked options, along with a strong trend towards offshore allocations. This transformation necessitated a keen eye on tracking trends to remain competitive and relevant. In addition, the myriad of global elections posed a unique challenge in managing client expectations. Building strong client relationships and maintaining open lines of communication were vital in addressing the uncertainties of the year.
A key strategy that proved successful was offering a diverse range of products tailored to meet the varied needs of clients. This approach enhanced client satisfaction by aligning investment products with specific client objectives.One of our focuses was on ensuring clients fully understand portfolio and investment strategies, and the importance of clear communication and education when introducing new investment concepts was evident.
Global economic and geopolitical events significantly influenced investment decisions and portfolio management in 2024. To address the potential outcomes of these events, having a diversified portfolio became crucial. This strategy ensured that portfolios could withstand various economic and political scenarios, providing resilience and adaptability in an unpredictable world.
