Since the outbreak of Covid-19 asset classes have tumbled globally. Modern portfolio theory always dictates that a well-diversified portfolio should have a mix of asset classes that diversify the risk / return profile over time. However, in periods of market shocks and fast-moving markets on the downside we see much more auto correlation between asset classes. That is, they all behave similarly in varying degrees which, in the short-term, confounds the diversification principle.
Old Mutual Alternative Investments (OMAI) is one of Africa’s largest alternative investment managers with over $4.1bn under management in infrastructure, private equity, mezzanine debt and impact funds. OMAI is a member of Old Mutual Investment Group, the South African investment management arm of Old Mutual. The company chooses to make a positive impact across Africa by going ‘Beyond the Obvious’ to uncover opportunities others may overlook, according to Paul Boynton, Joint CEO. Paul has been Head of Alternative Investments since 2004. He chairs the Alternative Assets Investment Committee and has served on the boards of African Infrastructure Investment Managers, Assore, African Clean Energy Development, CIT, J&J, Life Healthcare, Metcash, Mezzanine Partners, Old Mutual Investment Group, Pepkor, Tourvest and Phembani.
AGF’s Anna Lyudvig speaks with Rajaa Berrkia, Sustainability Director, Mediterrania Capital Partners about trends around sustainable investing, the firm’s approach to sustainable investing as well as recent investments and achievements
The local and global economic outlook is bleak, yet the same may not be true for markets. Investment firm RisCura recently hosted a webinar with leading investment specialists in order to get their views on Covid-19 and its impact on markets, the economy and society.
Tighter yields and strong competition in traditional markets have prompted European institutional investors to slow down in deploying their capital, despite having accumulated record levels of investable capital in recent years.
The Moody’s downgrade of South Africa’s credit rating should have happened long ago. We’ve known for a long time that our fiscal metrics have been unsustainable, so despite the coronavirus, this is unsurprising.
The below is the edited version of the Webinar presentation by Murega Mungai, Nairobi-based Trading Desk Manager for AZA, Africa’s biggest non-bank currency broker. For the recording, please click here: https://www.azafinance.com/how-african-businesses-can-survive-covid-19/
Sub-Saharan Africa is the only region in the world where there are more women who become entrepreneurs than men. Despite this, women-owned small businesses find it much tougher to secure financing and investment than their male counterparts.
Africa houses a plethora of economic blocks, legal codes and political systems. Each country and commodity have their own complexities to understand and overcome.
The general slowdown in equity markets was largely driven by a series of macroeconomic factors including an equity capital market (ECM) deceleration in global markets, according to PwC
African equities in general have not been a success story in the last ten years, at least not when compared to other regions. The MSCI US and the MSCI Developed World index rose 232% and 159% respectively in the last ten years, while the MSCI South Africa and MSCI EFM Africa ex. South Africa only gained 33% and 23% respectively in USD terms. Did African equities lag because of volatile politics, falling commodity prices, currency problems and/or economic mismanagement? Not really. Of course, such factors have a negative impact on earnings and currencies, but corporate earnings growth has been quite similar in Africa versus the rest of the world. The big gap in equity returns is almost entirely caused by an expansion of valuation differences.
After enduring a trying decade under the mismanagement and malfeasance of Jacob Zuma, South Africa enters the new year in a better place than 2019, economically and politically. Under President Cyril Ramaphosa, South Africa has much work to do to recover the “lost decade”, but the country and economy are finding some footing and making progress – even if limited at most.
As Africa moves into 2020, great excitement will remain over the continent’s emerging opportunities for investment and trade. For example, Mozambique will attract over $100bn in fresh capital over the next few years to develop its massive natural gas resources. Following recent African investment summits in Russia and Japan, both the UK and France will hold high profile events early next year to expand their commercial relations across Africa’s 54 countries.
What opportunities does Africa hold for private equity firms and their investors?