Jan-Daniël Klopper

We have shifted to a neutral stance across all major asset classes, aligning with our strategic asset allocation framework for the start of our third quarter. 

Our reduction in SA nominal bond exposure from moderately overweight to neutral reflects a reassessment of risk-adjusted returns, following a 55 basis point drop in real yields and diminished relative value compared with peers like Brazil. While local bonds still offer attractive income, rising geopolitical risks, evolving US trade dynamics, and uncertain global rate expectations prompted a more cautious view. 

We remain neutral on SA equities due to valuation concentration and sector-specific risks, particularly in the resource sector, despite a sharp YTD rally. Foreign equities face stretched valuations and weakening earnings, while global bonds offer conflicting signals, higher yields countered by inflation and fiscal concerns. This neutral positioning preserves flexibility to respond to market developments and capitalise on opportunities as they arise.

‍