If you had invested N$10,000 in 2024, the best returns would have come from equities. An investment in the Cirrus Namibia Capped Dual Listed Equity Index (CNDCLI) would have grown to N$12,072 by year-end, delivering an impressive 20.7% return.
Equities Shine Bright
Equities emerged as the top-performing asset class, with the CNDCLI delivering the highest returns in the Namibian context. “The CNDCLI index, priced in Namibian dollars, consists of JSE dual-listed companies on the Namibia Securities Exchange (NSX) Main Board,” explained Hiren Naidoo, a Junior Analyst at Cirrus Fund Managers.
To minimize concentration risk, the index caps the weighting of its constituents at 10%.
Although no exchange-traded fund (ETF) directly tracks the CNDCLI, investors can gain exposure by purchasing stocks such as Anglo-American PLC, Shoprite Holdings Ltd., and Nedbank Group Ltd.
Comparing Global and Local Indices
The MSCI World Index secured second place with a 19.1% return, translating into N$11,905 on a N$10,000 investment.
The global index tracks approximately 1,500 large and mid-cap companies across 23 developed countries.
“Strong performance was largely driven by large-cap technology stocks like Nvidia, Apple, and Microsoft, which consistently exceeded earnings expectations,” Naidoo nsaid.
Namibians can invest in the MSCI World Index through instruments like the FNB iShares Exchange Traded Note or the Satrix MSCI World Feeder Fund.
The NSX Local Index, after an exceptional 42.3% return in 2023, moderated to a 10% return in 2024.
Notable contributors included Letshego Holdings Ltd., with a 27.9% return, Capricorn Group Limited at 21.4%, and Nictus Holdings Ltd., which delivered 12.6%.
Commodities and Fixed Income
Commodities also performed well, with the NSX Commodity Index yielding an 18% return, or N$1,802 on a N$10,000 investment.
Geopolitical tensions, robust demand, and limited supply drove record highs in gold and silver prices. “Central banks increased gold reserves to counter inflation and currency risks,” Naidoo said.
Government bonds had an exceptional year, with South African bonds returning 17.3%.
Namibian nominal bonds and inflation-linked bonds returned 13.9% and 9.2%, respectively.
“South African bonds’ performance was buoyed by the formation of a Government of National Unity, which boosted investor confidence,” Naidoo said.
Cash Investments—Low Risk, Modest Gains
Cash investments, including fixed deposits and treasury bills, provided a return of 8.5%, adding N$851 to a N$10,000 investment.
The strong performance was initially driven by high interest rates, although these declined later in the year following three rate cuts.
Treasury bill and negotiable certificate of deposit yields fell from an average of 8.9% at the start of the year to between 7.5% and 8% by December.
Inflation’s Erosion Effect
Despite strong asset class performances, inflation remained a key consideration. Namibia’s annual inflation rate stood at 3.4% in December 2024.
“If you had kept your money under the mattress, your N$10,000 would only buy you N$9,671.18 worth of goods and services,” Naidoo said.
