Andrew Dittberner, Chief Investment Officer discusses how businesses can position themselves to withstand the gravitational pull of a sluggish economy by creating their own economies to establish new sources of growth. He explains that while technology-orientated businesses have been the overall beneficiaries of strong secular growth over the last few years, recent developments point to divergent prospects going forward. As a result, many of these businesses are actively harnessing innovation to create new avenues of growth, with the current developments within artificial intelligence being one such example.

Despite the economic slowdown being faced by many economies, certain companies within the global luxury goods sector have proven to be increasingly resilient. In this article, Head of Research, Victor Mupunga, unpacks the unique attributes of luxury goods businesses and explains why we hold Richemont and LVMH within our global and local equity portfolios.

On the local front, few companies have managed to grow despite lacklustre economic growth, with one industry particularly standing out for its ingenuity – local retailers. In this article, Research Analyst, Tasneem Samodien, gives an interesting overview of how certain local food and apparel retailers have managed to generate earnings growth through various market and economic cycles. However, these businesses are currently facing a challenging operating environment characterised by crippling load shedding and inflation. Given the gloomy short-term outlook, retailers are currently trading at significant valuation discounts, which we view as attractive entry points into a sector that has proven its relevance and resilience in the context of SA. Tasneem then points out that in line with our quality focused investment philosophy, our top picks are Mr Price and Shoprite.

Given that the rand has come under severe pressure since the start of the year, we conclude this issue with this article by Izak Odendaal, Investment Strategist at Old Mutual Wealth. Izak explains the various dynamics at play and shares his view on what is required for the rand to recover from current levels. Importantly, he makes the point that while the currency should recover to more reasonable levels, it is very likely to eventually resume its long-term depreciating trend. This calls for cool heads, perspective and patience on the part of investors.