Where does South Africa’s investment money really go?

South African investment managers oversee a staggering R8.38 trillion in assets, with the majority of that money invested domestically. According to the latest 27four survey, 75.8% of reported assets are invested in South Africa, with the remaining 24.2% scattered across global markets outside Africa and the rest of Africa. This domestic concentration comes with higher risk, as the portfolio is more exposed to domestic market fluctuations and economic conditions.

The investment industry is dominated by a small number of large managers, with the 20 biggest institutions managing 86.9% of reported assets and the remaining 13.1% managed by smaller firms. Despite the presence of numerous investment strategies, a limited number of established approaches dominate the market, accounting for roughly 70% of assets under management.

Multi-asset portfolios, which combine various investment types, make up the largest category at 28.6%, followed by active equity (23.4%) and active fixed income (18.4%).

The survey reveals a disparity between the workforce and decision-making authority within the industry. While women make up 53% of industry employees, they only hold 25% of listed-market portfolio-manager positions. This suggests that the expertise of women in the field may not be fully leveraged in determining investment strategies and decisions.

Furthermore, retirement fund members should pay attention to who manages their funds and the fees they pay, as these factors can significantly impact the growth and safety of their long-term savings.