MEETING PURPOSE
Our investment team aim to meet every week to discuss the macro environment and how this could impact our current and future portfolio construction.
KEY TAKEAWAYS
- Markets showing strength across equities and commodities despite geopolitical/economic concerns
- Debate over whether to chase rallies or remain cautious given potential risks
- Agreement on maintaining a “barbell” strategy with exposure to both commodities/gold and technology stocks
TOPICS
Market Overview
- Global equities, commodities and property are all showing strength
- Bond markets are less bullish, potentially signalling future issues
- Dollar weakness supporting non-US equities and commodities
- SA equity market outperforming despite poor economic fundamentals
Commodity Focus
- PGM (platinum group metals) prices breaking out technically
- Gold stable at US$ 3385 (price as at 12 June 2025), silver catching up on industrial demand and as correlated catch-up trade to Gold
- Oil finding support from OPEC+ cuts and declining US rig count
- Debate over adding to commodity exposure, especially PGMs – discussed certain targets to buy or sell and will monitor for short term action.
Portfolio Positioning
- Debate over chasing rallies vs remaining cautious given risks
- Added to iShares EM value factor ETF, S&P 500 and silver ETFs in the International Managed Flexible Fund
- Considering increasing Satrix Resi ETF exposure in SA funds
- Maintaining “barbell” of commodities/gold and technology stocks
Market Dynamics
- Retail investors and algorithms potentially masking underlying issues
- Passive flows into indices making it difficult for active managers
- Debate over efficiency of markets in pricing in all information
Economic/Geopolitical Backdrop
- Concerns over US debt, potential recession and geopolitical tensions
- However, markets seemingly discounting these risks for now
- Lower global interest rates and weak dollar supportive of risk assets
Next Steps
- Monitor technical indicators on STXRESI (SA resources ETF) for potential profit-taking levels
- Consider adding more PGM exposure if technical breakouts continue
- Remain vigilant on US bond yields and dollar for potential trend changes
The content of this article is for information purposes only and does not constitute an offer or invitation to any person. The opinions expressed are subject to change and are not to be interpreted as investment advice. You should consult an adviser who will be able to provide appropriate advice that is based on your specific needs and circumstances. The information and opinions contained herein have been compiled or arrived at from sources believed to be reliable and given in good faith, but no representation is made as to their accuracy, completeness or correctness.3