As we mark our 35th anniversary this year, we took the opportunity to reflect on how far we've come and to celebrate our return to a refurbished Cape Town head office. It was a fitting moment to reaffirm what has always mattered to us: our commitment to the city where Ninety One began, and to South Africa's role in our story.
Looking back over three and a half decades, one thing stands out. Markets change, often in ways that are difficult to predict. However, the principles of successful investing remain remarkably consistent. Staying disciplined, adapting thoughtfully and keeping a long-term perspective have mattered through every cycle. They matter just as much today.
As Paul Hutchinson highlights in his article, one of the most useful principles is to focus on what we can control. Long-term outcomes are shaped less by short-term market moves and more by consistent decisions over time. These include how we allocate capital, how we manage risk, and how we stay invested through periods of uncertainty.
Current geopolitical headwinds are a reminder of how quickly conditions can change. Markets can reprice rapidly as new information emerges, reinforcing the need for portfolios that are resilient to a range of outcomes.
Beyond these near-term pressures, the structural backdrop is shifting. As Sahil Mahtani explores in his recent piece on the end of easy globalisation, the world is becoming more fragmented, more competitive and, at times, less predictable.
This reflects a deeper shift in how the global system operates. Assumptions that investors have long depended on, from stable inflation to predictable relationships between asset classes, are becoming less reliable.
Against this backdrop, it is worth reflecting on one of the most defining investment trends of the past decade: the rise of passive investing. Passive strategies have delivered strong outcomes, particularly in markets where performance has been driven by a relatively small number of large companies. They are cost-effective, transparent and play an important role in portfolios.
But they are not the full story. Because indices are weighted by market capitalisation, they tend to drift toward concentration over time. This can leave investors more exposed to a narrow set of companies or sectors than they might realise.
The opportunity set is also evolving. Structural changes in the global economy are creating new winners and reshaping old ones. In this environment, flexibility matters. The ability to look beyond the index, to assess risks carefully and to allocate capital selectively becomes increasingly important.
This is where active management can add real value, not as a replacement for passive investing, but as a complement to it.
We see this particularly clearly in emerging markets. After several years of being out of favour, capital is starting to return to the asset class, with much of the early allocation coming through passive vehicles. As markets become more differentiated, the role of active management becomes increasingly important.
Emerging markets are inherently less efficient. Differences in regulation, governance, liquidity and investor behaviour create both risk and opportunity. For active managers with a disciplined process, they also create the potential to identify mispriced assets and invest in businesses that may not yet be fully reflected in the index.
In this edition of Taking Stock, we explore that opportunity set in more detail, including why we believe it may be the right time to consider emerging market equities as part of a forward-looking portfolio. We are also excited to announce the launch of the Ninety One Emerging Markets Equity Feeder Fund, designed to provide investors access to this opportunity set.
Reflecting on 35 years of investing, one lesson has endured. Market leadership does not stand still. The winners of one decade are rarely the same in the next. Periods of concentration tend to give way to broader opportunity sets.
For investors, that has an important implication. Relying too heavily on what has worked in the past can leave portfolios exposed when leadership shifts. Like motorsport, success is not about staying in pole position for a single lap, but about managing tyres, fuel and strategy over the full distance. Markets work the same way. Success comes not from chasing yesterday’s leaders, but from staying flexible and making disciplined decisions across the cycle.
As we look ahead, the environment is becoming more complex, but also more interesting. Opportunities are starting to broaden, and the case for selective, active decision-making is strengthening.
At Ninety One, our focus remains on helping clients navigate this change. Thirty-five years on, that commitment has not changed. If anything, it has become even more relevant.
Thank you for your continued support.
Siobhan Simpson
Head of SA Unit Trusts
Authored by
