Press release: 21 October 2025
Johannesburg, 21 October 2025 – South African investors are increasingly recognising that
traditional investment approaches alone may no longer deliver the returns and stability
needed in today’s complex markets. This shift has driven significant growth in structured
products and alternative investments, with wealthy individuals leading the charge towards
more diversified portfolio strategies.
Recent data reveals that South Africans have invested R17.5 billion into structured products
in 2024, marking a return to levels last seen in the 1990s. This surge reflects a broader trend
towards portfolio sophistication, as investors seek security and certainty while maintaining
growth potential.
Frikkie van Loggerenberg, CEO of IFSA Asset Managers, observes that the investment
landscape has transformed dramatically over the past decade. “There’s been this myth that
alternatives are only reserved for larger portfolios and pension funds. But we’re seeing a
fundamental shift where investors understand that a truly resilient portfolio requires a blend
of traditional and alternative assets,” he explains.
The evolution extends beyond wealthy individuals. Retail investors now have unprecedented
access to investment strategies that were once the preserve of institutional players. This
democratisation of investment opportunities comes at a crucial time, as South African
equities and bonds continue to experience prolonged volatility.
Van Loggerenberg advocates for a holistic approach to portfolio construction that embraces
both traditional and alternative investments. “From a South African perspective, your
investment portfolio should have an allocation to equities, bonds, cash, offshore exposure,
and alternatives. The percentage allocations depend on your personal risk profile and
income needs,” he notes.
The appeal of blended strategies lies in their ability to smooth investment journeys.
Alternative investments typically demonstrate lower correlation to stock market movements,
providing stability during turbulent periods. When combined with traditional assets, they
create portfolios that are more resilient and better equipped to weather market volatility.
Infrastructure development and renewable energy have emerged as particularly compelling
opportunities within the alternative space. South Africa’s transition to sustainable energy
solutions and the government’s openness to independent power producers have created
significant investment prospects. Similarly, the technology sector, driven by digital
transformation needs across industries, presents opportunities for those willing to look
beyond traditional equity markets.
However, van Loggerenberg emphasises the importance of understanding the
characteristics of different asset classes. “Private equity isn’t listed on the exchange, so
liquidating positions isn’t as straightforward as in the listed environment. If you plan for that
and incorporate it into your five-year or seven-year investment horizon, it provides excellent
portfolio enhancement,” he explains. “It means that if there’s even a marginal improvement
in underlying conditions there’s less volatility in your portfolio and you stand to derive equity-
type returns.”
Many South Africans are particularly drawn to the protection offered by offshore
investments, seeking to benefit from global market exposure while maintaining capital
protection features, but there are still local opportunities if you know where to look.
As van Loggerenberg notes, “Wherever there’s a problem, there is an opportunity to fix it.
South Africa faces some challenges, but with proper homework, a bit of skill, and strategic
thinking, investors can position themselves advantageously.”
The upshot is that in an environment where traditional strategies may fall short, a
thoughtfully constructed portfolio that blends conventional and alternative investments offers
the best prospect for achieving long-term financial objectives. As the investment landscape
continues to evolve, those who embrace this sophisticated approach will be better positioned
to navigate uncertainty while capturing growth opportunities.
IFSA continues to guide investors through the intricacies of building resilient portfolios,
demonstrating that the future of investment lies not in choosing between traditional and
alternative assets, but in understanding how to blend them effectively for optimal results.
