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JSE listings: Signs of life

Claude van Cuyck — Wed, 24 Jun 2026 08:29:21 +0000

In a Glacier Funds on Friday article two years ago, Denker Capital cautioned that the Johannesburg Stock Exchange (JSE) was shrinking, with delistings consistently outpacing new listings and eroding the depth of South Africa’s equity market. That challenge has not disappeared – but the story has evolved. In this article, Claude van Cuyck, Head of SA Equity at Denker Capital, revisits the topic, offering an updated perspective on why the environment for new listings is beginning to improve, what has changed since the original assessment, and why a healthier primary market matters for long‑term investors and financial advisers.

This article first appeared in Glacier’s Funds on Friday newsletter.

The starting point: from warning to reassessment

In our article in mid-2024, ‘Delistings and the changing landscape of the JSE’, the dominant concern was clear: South Africa’s listed universe was shrinking, and new listings were not arriving in sufficient numbers to replenish it. Delistings have continued, and the exchange remains far smaller than it was at its peak.

Figure 1: Number of listed companies on the JSE (1995–2025)

Source: JSE data

The most meaningful change since our earlier article is not that the delisting trend has suddenly reversed. It has not. Rather, the environment for new listings has improved in ways that could matter over time. Sentiment has become more constructive, macro conditions have steadied, and the JSE itself has moved with greater urgency to make listing rules more practical and more competitive. For long-term investors, that matters. A healthy market is not measured only by today’s valuations, the current macro environment and potential growth opportunities. It is also measured by whether good businesses are willing to come to market, raise capital, and broaden the opportunity set for investors.

For investors and financial advisers, this is the central point: the JSE is still navigating the consequences of a long period in which delistings have consistently outnumbered new listings, but the foundations for a more supportive primary market are firmer than they were when we covered this topic two years ago. That does not guarantee a listing boom. It does, however, improve the odds that the next few years look better than the last few.

The delisting trend is still real

It would be a mistake to overstate the turnaround. The structural reasons for delistings remain with us. In many cases, smaller- and mid-cap companies still trade at discounts to intrinsic value, liquidity is often thin, and the costs of maintaining a public listing can feel disproportionate relative to the benefits. When a listed company can access strategic capital privately, or when management and controlling shareholders believe the market is not recognising value, delisting remains a rational option.

That was true when we highlighted transactions such as Royal Bafokeng Platinum, Distell, Mediclinic, PSG Group and Alviva in 2024. It has remained true since then. In the subsequent period we’ve seen meaningful exits and proposed exits from the market. African Rainbow Capital Investments moved ahead with its offer and delisting in 2025. Other notable delistings in 2025 include Rebosis Property Fund, Trencor, AH-Vest, Ayo Technology Solutions, Adcock Ingram, Ascendis and Curro. Barloworld confirmed the delisting of its ordinary shares in January 2026. These transactions differ in structure and strategic rationale (some due to buyouts, others due to business rescue), but they reinforce the same message: the forces behind delistings have not gone away.

For investors, delistings are not uniformly negative. In several cases they occur at material premiums and create immediate value for shareholders. The problem is that a market cannot thrive indefinitely if attractive exits consistently outpace attractive entrances.

Why the tone is more constructive now

The more hopeful story lies on the other side of that equation. Since mid-2024, three developments in particular suggest that the listing environment is improving.

1. The JSE itself has acknowledged a better backdrop

When Boxer listed in November 2024, the exchange said it had welcomed seven new listings in 2024, with another still in the pipeline, and noted that sentiment around new listings had improved materially. That was an important signal because it suggested a shift from the very subdued listing environment that characterised the previous few years.

2. The composition of new listings has become broader and more interesting

Boxer’s November 2024 initial public offering (IPO) was significant not merely because of its size, but because it represented one of the largest public offerings in the past decade. It reminded the market that the JSE can still support sizeable equity issuance when the asset is compelling, the growth case is understandable, and pricing is sensible.

After that came a broader mix of listings. Cilo Cybin listed on AltX in June 2024 as a cannabis-focused SPAC and later moved to the Main Board. In 2025, ASP Isotopes, Optasia and Cell C all came to market. These businesses span retail, specialist healthcare property, advanced materials, fintech and telecommunications. That diversity matters because a healthier exchange should not depend on one sector or one type of issuer. Variety deepens the market and broadens the choice set for investors.

3. Regulatory reform is starting to show tangible effects

When the Financial Sector Conduct Authority (FSCA) approved the JSE’s Simplification Project in January 2026, the JSE explicitly said its listings pipeline had strengthened in 2025 and pointed to companies such as ASP Isotopes, Optasia and Cell C as evidence that reforms were beginning to have practical effect.

Changes in the regulatory environment

The most important improvement since our earlier article may be regulatory rather than cyclical.

One of the longstanding criticisms of the JSE has been that listing requirements can be too onerous, particularly for smaller issuers. That criticism was never really about investor protection as a concept; it was about whether the balance between investor protection, cost and administrative complexity had tilted too far against issuers. Since 2024, the JSE has taken visible steps to address that concern.

The first major initiative was market segmentation. Approved with effect from September 2024, this reform repositioned the Main Board into Prime and General Segments. The logic is sensible: not every listed company should face the same regulatory burden if size, liquidity and market impact differ materially. A more calibrated framework can preserve disclosure standards while reducing unnecessary cost and friction for eligible issuers. For companies outside the largest and most liquid part of the market, this can improve the economics of remaining listed and may also make a future listing more attractive.
The second major initiative was simplification of the listing requirements, as part of the JSE’s Simplification Project. By January 2026, the FSCA had approved a revised framework that reduced the volume of the listing requirements by more than half, used plainer language, and aimed to remove duplication and ambiguity. More importantly, the reforms went beyond cosmetic redrafting. They included changes designed to lower administrative burden and listing friction, such as a more efficient pre-listing statement construct, reduced voting thresholds for certain capital actions, less onerous financial information requirements in some transactions, expanded flexibility for SPACs, and an expanded secondary listings framework. These reforms are aimed less at loosening regulation and more at making regulation usable. This is important in a market trying to improve its attractiveness to new issuers while preserving investor protection.

These changes matter because they affect real-world behaviour. Companies and their advisers respond to the total cost of being public: direct costs, compliance effort, timing uncertainty and management distraction. If those factors become more manageable, the relative attractiveness of a listing improves. That does not automatically produce a flood of IPOs, but it removes one of the arguments against coming to market.

Another underappreciated potential source of future JSE listings lies in the junior mining and exploration space. The Minerals Council South Africa has been advocating a Canada-style flow-through share tax incentive to revive exploration funding, arguing that South Africa’s exploration spend has declined sharply and that junior explorers need better access to risk capital. In Canada, flow-through shares are supported by a mineral exploration tax credit (15%) that helps attract retail and other investors into early-stage exploration companies. If South Africa were to implement a comparable regime, it could strengthen the exploration pipeline and, over time, support the emergence of a fresh pool of junior miners and exploration companies capable of listing on the JSE.

Why primary-market health matters for investors and advisors

Investors and financial advisers should care about this for reasons that go beyond headlines.

A broader listed market improves diversification. When the local opportunity set narrows, portfolios become more concentrated in a smaller number of familiar names. Concentration can work for a time, particularly when the remaining companies are high quality, but it reduces flexibility and can make portfolios more vulnerable to sector-specific or company-specific shocks.
A healthier listing environment also improves market renewal. Established companies remain important, but long-term equity returns are often enhanced when investors have access to emerging businesses earlier in their growth journey. New listings provide that renewal. They introduce new business models, new sectors and, occasionally, future market leaders.
There is also a signalling effect. Companies choose to list when they believe the market will value them fairly, provide access to capital and support future growth. An improving IPO environment therefore tells investors something about confidence in the broader capital market ecosystem. It suggests that entrepreneurs, sponsors and controlling shareholders increasingly see public markets as part of the solution rather than simply a source of cost and scrutiny.
For investors, this has practical implications. Over time, a deeper and more active primary market can create more opportunities to allocate client capital across different growth profiles, sectors and listing structures. It can also improve the case for remaining engaged with domestic equities at a time when it has become easy to default toward offshore diversification alone. Offshore exposure remains essential but renewed local market depth strengthens the case for balance rather than abandonment.

What still needs to happen

Progress should be measured in years, not months. A few successful listings do not yet amount to a full revival.

For the JSE to enjoy a sustained improvement in new listings, several things likely need to happen together:

South Africa’s economic backdrop must remain more stable.
Business confidence must keep improving. The cost-benefit equation of being listed must continue to move in the right direction.
Liquidity, especially outside the very largest counters, must improve enough for companies to believe the market can price their shares efficiently.
The pipeline needs to include not only secondary listings and restructurings, but genuine entrepreneurial IPOs where companies choose the market as their preferred growth platform.

The last point is important. Some recent listings have arisen through restructurings, carve-outs or strategic repositioning. These can still be valuable additions to the market, but the strongest signal of a truly revitalised exchange would be a broader stream of founder-led or sponsor-backed businesses electing to list because they see the JSE as an attractive long-term home.

There is also a role for investors themselves. A market that complains about the lack of listings while refusing to support credible new issues sends the wrong signal. Investors should remain disciplined on valuation and quality, but they should also recognise that a functioning primary market depends on thoughtful participation. When good businesses come at sensible prices, support matters.

The road ahead for the JSE

The environment has improved meaningfully over the last two years, even if it has not yet fully turned.

The JSE can also look forward to a few potential new listings in 2026. Post the delisting of MultiChoice (after it was acquired by Canal+), we can expect a secondary listing of Canal+ on the JSE. Another high probability listing will be Coca-Cola HBC. After acquiring a 75% stake in Coca-Cola Beverages Africa, it has indicated that it will pursue a secondary listing on the JSE (primary listing on the LSE). In addition, privately held Fidelity Services Group (security company) has indicated its potential for an IPO.

For investors and advisers, the implication is encouraging but measured. South African equities still require selectivity and patience. Delistings will remain part of the landscape. Yet the JSE today looks less like a market in uninterrupted decline and more like a market that is trying, credibly, to rebuild its appeal. If that effort continues and the broader environment remains supportive, the next chapter for the exchange could be defined not only by who exits, but increasingly by new entrants.

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Goodbye, old friend: The changing role of US bonds in portfolios

Madalet Sessions — Thu, 18 Jun 2026 07:17:44 +0000

In this article, Denker Capital’s Head of Multi-Asset, Madalet Sessions, examines how the role of US sovereign bonds has shifted from a reliable safe haven to no longer behaving like the defensive anchor investors once relied on, and what this changing relationship means for portfolio resilience.

This article first appeared in Glacier’s Funds on Friday newsletter.

When US bonds were a reliable safe haven

I started working in financial markets in 2006. For most of the period since then, during which I’ve developed my understanding and intuition of markets, the US sovereign bond market was a remarkable safe-haven asset. In good times, when equity markets were delivering attractive returns, investors would earn a positive return from the bond market (in dollars). And, in times of market stress, or risk aversion, the bond market would gain in value as real yields and inflation compensation would decline.

Table 1 shows the returns for developed markets equity (the MSCI World Index), emerging markets equity (the MSCI Emerging Markets Index), the US sovereign bond market (US 10-yr bonds) and the dollar index (DXY) after the bursting of the dotcom bubble, the global financial crisis and the Covid-19 pandemic shock.

Table 1: US dollar returns during times of stress

Source: Refinitiv and Denker Capital calculations. *Price returns are reflected. **Total return assuming a constant maturity instrument with coupons reinvested.

Negative correlations and portfolio stability

For the 20-year period between 2000 and 2020, correlations between risky equity assets and the US bond market were consistently negative. Hence, the moniker ‘safe-haven asset’ (an asset that appreciates when growth/risk assets sell off). In times of stress, the US dollar and the US sovereign bond market provided portfolio stability. These were the best of times.

In Table 2, each cell shows the correlation between the returns of the asset in the row and the asset in the column, with positive values indicating assets that move together and negative values indicating assets that tend to move in opposite directions.

Table 2: Correlations between equity markets, sovereign bond market and US dollar returns – monthly data from January 2000 to December 2020

Source: Refinitiv and Denker Capital calculations

A regime shift: bond behaviour to growth risks changed

The central problem today is that US bond duration has shifted from an asset that hedged against growth risks to an asset subject to growth risks.

Since the start of 2021, the relationship between risky equity assets and the US bond market has dramatically altered and is now (unfortunately) positive. The US dollar remains a safe place to hide, but the US bond market is now an asset that declines in value as risk aversion rises and/or growth prospects deteriorate.

Table 3: Correlations between equity markets, sovereign bond market and US dollar returns – monthly data from January 2021 to April 2026

Source: Refinitiv and Denker Capital calculations

More or less at the time that correlations between risky assets and the market turned positive, bond yields in the US started rising. We know from the difference in yields between vanilla and inflation-protected bond yields that investors continue to think that ~2% inflation remains a reasonable base case in the US. However, the options market¹ tells us that investors are far less certain about the base case. Where in 2020 the likely range of inflation outcomes over five years (10^th to 90^th percentile) varied from 0.9% to 3.2%, by 2025 the range had drifted significantly wider to 0.7% to 4.9%.

There are a number of contributing factors, but whatever the reason, investors are now of the opinion that the value of a US Treasury note is no longer unaffected by the growth prospects of the US (or global) economy.

Figure 1 shows the yield to maturity and subsequent 10-year returns earned by owning 10-year maturity US sovereign debt.

Three things are worth highlighting:

the yield at which you buy is a very good indicator of the return you are likely to earn. When yields are low returns are low. When yields are high, returns are higher. When yields go up, it drags on returns and when yields decline, it provides a tailwind to returns;
investors earned modest, but (mostly) positive returns, from the safe-haven assets in their portfolio; and
yields are at least higher than they were. This provides some relief to investors that now have far fewer options for building hedged portfolios.

Figure 1: 10-year US Treasury yield vs. next 10-year bond returns

Source: Refinitiv and Denker Capital calculations

Recent stress episodes tell a different story

In Table 4, below, we show two post-Covid periods of equity market stress: the week following the Liberation Day tariff announcements; and the turmoil in the Middle East in March of 2026. Readers should note that these periods of turmoil are short and sharp while our earlier examples extended for months (not just days or weeks).

Table 4: Returns during times of stress

Source: Refinitiv and Denker Capital calculations. *Price returns are reflected. **Total return assuming a constant maturity instrument with coupons reinvested.

There is a clear difference between Table 1 and Table 4. In the former, equity market stress saw positive returns for the US dollar index (DXY) and the US bond market (US 10-yr). In Table 4, the DXY weakened in the week in question in April 2025 and strengthened in March 2026. The bond market in both episodes closed lower.

What is clear from the table is that the different behaviour of the US bond market makes it far harder to protect investors’ capital in times of stress. Bond market duration used to assist in preserving capital values and, although US bonds are not high beta assets (i.e. they decline by less than the equity markets), they do decline.

The rand investor’s experience is different

In our daily lives the volatile rand is usually thought of as a curse but, for the rand investor’s savings, it is an invaluable tool for constructing resilient portfolios. The rand is one of the most volatile currencies globally. This makes the value of offshore assets unusually volatile in rand terms, but during market stress the weaker rand often offsets falls in offshore asset values. For the rand investor, the combination of dollar strength and attractive bond returns in times of stress was doubly valuable.

Building diversified portfolios for the world we have

It is still too early to declare, with confidence, that we have entered a permanent new regime. But the evidence since 2021 is strong enough to change how investors should think about portfolio construction to achieve attractive risk-adjusted returns: US duration can no longer be relied upon to rise when equities sell off.

For most investors, the path of returns matters as much as the destination because:

drawdowns affect behaviour,
liquidity needs are real, and
volatility can reduce compounded wealth.

The practical implication is simple: if the traditional safety of the US bond market is less dependable, investors must be more deliberate about where diversification and protection will come from. For rand-based investors the dollar may still provide valuable protection in stress, but the combination of dollar strength and positive bond returns can no longer be taken for granted.

We may miss the good old days – but portfolios should be built for the world we have, not the world we wish would return.

1 Current and Historical Market-Based Probabilities | Federal Reserve Bank of Minneapolis

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Is there Space in your portfolio?

Lizelle van Rooyen — Wed, 17 Jun 2026 10:05:53 +0000

In this article, Lizelle van Rooyen, Equity Analyst at Denker Capital, explores how space is shifting from science fiction to economic infrastructure and what that means for investors.

This article first appeared in Glacier’s Funds on Friday newsletter.

In 1998, Iridium launched a constellation of 66 satellites to deliver global mobile coverage. It was a marvel of engineering and yet, nine months after launching services, Iridium was bankrupt. The economics simply did not work at the launch costs of the day.

A quarter-century later, almost every assumption that underpinned Iridium’s failure has been rewritten. Today there are thousands of satellites in orbit, serving millions of broadband subscribers globally. The cost of launching a kilogram into low Earth orbit has fallen by more than 95%, and companies such as SpaceX are still driving costs lower. Another tenfold decline is possible by the mid-2030s. Investors now face a different question: not whether space is reachable, but which space businesses will prove durable.

That shift from cost-prohibitive to cost-competitive is the kind of inflection that, in other industries, has marked the start of multi-decade infrastructure buildouts. Railways and telecoms followed that trajectory, beginning as curiosities and novelties, then quietly settling in as the everyday backbone of the economy. Space is following the same script, and the listed equity universe is only barely beginning to reflect it.

Two forces are driving the renaissance

The acceleration in space activity is not accidental; it is being propelled by two powerful, converging forces:

1. A revolutionary collapse in launch costs, driven by reusability

At the height of the space shuttle era, launching a kilogram into low Earth orbit cost roughly $54,500/kg. SpaceX’s Falcon 9 has brought that down to around $2,700/kg, and Falcon Heavy to $1,400/kg. ¹Starship, SpaceX’s next-generation reusable vehicle, targets below $200/kg. If achieved, that would be a 200-fold reduction in six decades, with most of the decline concentrated in the past ten years.

At $54,500/kg, space is a government programme. At a few hundred dollars per kilogram, it’s a logistics network embedded in everyday economic activity. Almost every commercial space opportunity that exists today either did not exist or was not economically viable before this cost collapse. Launching heavy equipment into orbit accounts for roughly 70% of total mission cost, so further reductions there would unlock many more opportunities.

2. A looming crisis in the infrastructure on Earth required for AI

There is no AI without electricity, and AI’s appetite for electricity has become structural. The International Energy Agency expects global data-centre electricity consumption to roughly double by 2030, while Morgan Stanley estimates that US data-centre consumption could rise from about 6% of total power use in 2024 to close to 20% by the mid-2030s. Local grids are already under strain. A single 1 GW campus consumes as much power as roughly 20% of New York City². Elon Musk has spoken of hundreds of GW of new data-centre capacity per year³. Most analysts treat that figure with scepticism, but even a fraction of it implies a power problem Earth cannot solve alone.

This is why putting compute in orbit no longer looks far-fetched. In the right orbit, a satellite’s solar panels receive near-continuous sunshine, yielding up to eight times the annual energy of equivalent panels on Earth and largely eliminating the need for battery storage⁴. Cooling, the perennial headache of every terrestrial data-centre, is also easier in space. On Earth, data-centres consume rivers of water to dissipate heat. In orbit, large radiators can do the same job by shedding heat directly into the cold vacuum. Space-based facilities can also be deployed faster, bypassing the multi-year permitting, grid-connection and environmental approvals on Earth.

Early trials are already underway, with companies like Google (Project Suncatcher), SpaceX and the start-up Starcloud, supported by NVIDIA and Crusoe, testing AI computing in orbit. For now, the investment case still has its feet firmly on the ground. Realistically, orbital data-centres are a 2030s story, requiring launch costs to fall further before the economics work and launch capacity to increase. The upfront capital expenditure will be far higher than for terrestrial equivalents, but lifetime operating costs could be materially lower. That is the bet serious capital is already making.

The opportunity set is broader than the AI angle

Space is more than an AI trade as it offers a wide range of opportunities:

Defence and national security. Satellites are now central to modern warfare and defence: communications, navigation, intelligence gathering and increasingly offensive capabilities. The war in Ukraine underscored how strategic this infrastructure has become, and JP Morgan expects the defence layer alone to more than double by 2035. The Pentagon’s ‘Golden Dome’ missile-defence concept requires thousands of new satellites to function – and that is one programme, in one country.
Earth observation. Satellite imagery has quietly become an input to industries from agriculture (predicting yields and optimising fertiliser) to insurance (data-driven underwriting and disaster monitoring) to shipping (real-time vessel and container tracking). It is, in effect, a data business operating from a very particular vantage point. Anyone using Google Maps or tracking shipping flows on Bloomberg is, in effect, interacting with the space economy.
Satellite broadband. Perhaps the most visible commercial success. Constellations like Starlink and Amazon’s Project Kuiper aim to provide high-speed internet to the two billion people globally who lack reliable access. The economic value unlocked by connecting them is difficult to quantify, but almost certainly enormous.
Frontier markets. Emerging but high-potential areas include in-space manufacturing, space mining, resource extraction and even space tourism. While they may offer long-term potential, they have not yet been proven commercially.

Today, the global space economy is around $615 billion and growing at roughly 8% a year, with the commercial sector accounting for 78% of the total⁵. The drivers above could push it toward $1 trillion within a decade.

What this means for investors

The honest takeaway for investors: the opportunity is real, structural and early. But it is also imperfect.

Much of the most compelling value sits in private markets, and SpaceX is the standout example.

Founded by Elon Musk in 2002, SpaceX has rewritten the economics of spaceflight through two design choices: reusability and vertical integration. Falcon 9 boosters, once treated as disposable, now routinely return, land, and re-fly, with individual boosters having flown more than 20 missions. Furthermore, by building most components in-house, SpaceX has sidestepped the cost-plus contracting model that has historically inflated aerospace pricing.

These advantages are now evident in SpaceX’s operating footprint. Its Falcon 9 and Falcon Heavy rockets dominate global launches, accounting for roughly 80% of mass put into orbit in 2025. Starship, its next-generation rocket, is targeting a dramatic drop in launch costs to levels where orbital data-centres make economic sense. Starlink, its satellite network, has grown to over 9,600 satellites and 10.3 million subscribers, generating $11.4 billion in revenue in 2025, representing a growth rate of 50% y/y. Starshield is its dedicated military business. Lastly, they run a vertically integrated AI platform spanning compute infrastructure, the Grok model, AI solutions, and the X platform.

The prospect of a SpaceX initial public offering (IPO) has attracted enormous attention, along with valuation expectations that should give investors pause. Recent press reports suggest a listing valuation approaching $1.75 trillion, which would be the largest in history and is likely to draw even greater attention to the whole sector. Until then, public-market exposure to SpaceX remains limited. EchoStar is one of the few proxies. As part of a spectrum deal, it is set to receive SpaceX shares.

SpaceX’s achievements to date are real, but investors should not overlook the risks. The valuation already assumes years of strong future growth. Key-person dependency is unusually high, with Musk’s attention divided across multiple companies. A dual-class share structure will leave minority investors with limited governance influence, while a meaningful share of revenue still depends on US government and defence contracts, bringing political exposure with it.

The listed opportunity set spans the full value chain.

The value chain runs from materials and space-grade semiconductor suppliers to spacecraft builders and satellite operators, with a wide range of space enablers in between.

The listed pure-play space companies carry high risks. Names like Rocket Lab, Planet Labs, AST SpaceMobile, Iridium, Viasat, Redwire, MDA Space and newer listed players like Intuitive Machines and Firefly Aerospace, are mostly not yet profitable and are burning cash. The first generation of satellite broadband companies went bankrupt, despite genuine technological achievement, because costs were too high. Investors who lived through telecoms in 1999 will recognise the pattern: the technology and the demand are real, but separating winners from cautionary tales requires patience and selectivity.

For most investors, indirect exposure through diversified companies may be the more practical option. Large technology companies like Amazon, Alphabet, and Microsoft all have meaningful and growing space programmes from satellite broadband to orbital infrastructure investments. Picks-and-shovels suppliers offer exposure to the build-out itself. Defence primes like Lockheed Martin, Northrop Grumman and L3Harris supply satellites and launch systems to commercial and government customers; BAE Systems and Microchip make the radiation-hardened semiconductors that survive orbit; and Airbus and Thales Alenia Space⁶ specialise in thermal management and satellite systems.

It is, in fact, rocket science.

Commercialising space carries unique risks. Beyond intense capital burn and regulatory hurdles, hardware must survive radiation and thermal cycling, and on-orbit repair is essentially impossible. When a satellite fails, the usual answer is to write it off and launch a replacement. Space is also becoming crowded enough that a single collision could, in the worst case, trigger a chain reaction severe enough to render an entire orbit commercially unusable for years. This is a tail risk known as Kessler syndrome.

The closing thought

Twenty years ago, this was science fiction. Today, it is just science and edging into infrastructure. For the thesis to hold, a few things need to go right:

launch costs must continue to fall and launch cadence must continue to rise,
orbital congestion must remain manageable, and
demand for space-based services must prove durable.

None of these are guaranteed, and the path will almost certainly be uneven.

What is available in listed markets today is, for now, imperfect. Much of the cleanest value is held privately, by backers willing to operate on timescales that conventional funds often do not. The most attractive long-term opportunities are likely not the rocket builders themselves, but the picks-and-shovels plays and, over time, the software and service businesses that the space ecosystem will enable. Good businesses do not always make good investments, and patience is part of the cost of admission.

However, investors do not need perfect foresight on timing or outcomes. What matters is recognising the direction of travel. A new layer of infrastructure is taking shape, incrementally, expensively, and largely out of sight, but with the potential to become as embedded and indispensable as the networks that came before it. The opportunity today is not to make concentrated bets on uncertain end-states, but to begin making sense of a world in which space is no longer a frontier market, but part of the global economic backbone.

The sky, as it turns out, was never really the limit.

Note: SpaceX plans to IPO on 12 June 2026. For more information, please refer to their prospectus.

1 https://ntrs.nasa.gov/api/citations/20200001093/downloads/2020 0001093.pdf; Aerospace Security, https://www.sec.gov/Archives/edgar/data/1181412/000162828026036936/spaceexplorationtechnologi.htm

2 Mirion fourth quarter and full year 2025 earnings presentation (slide11)

3 https://www.dwarkesh.com/p/elon-musk

4 Google Research, Towards a future space-based, highly scalable AI infrastructure system design (2025).

5 Bernstein, Space Opportunities (March 2026), citing The Space Foundation.

6 Not listed separately but owned by Thales Group and Leonardo that are both listed

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Meet Alex Hayman

Alex Hayman — Wed, 18 Mar 2026 13:09:33 +0000

Earlier this year, Alex Hayman joined our business development team. We asked him five questions to get to know him better — touching on his background, how he sees the industry, and what keeps him grounded.

If you didn’t work in the asset management industry, what do you think you would have done instead?

I would have worked in IT. I have a passion for all things technology and have completed a degree in computer science. Programming gives me an outlet for creativity and problem solving in a way I haven’t replicated anywhere else. The variety of challenges it presents and the reward when you finally get something to work is genuinely hard to match.

What do you think is one of the most common misperceptions people have about the world of investment management?

That it is a perfect science. University teaches you to apply rules and formulas to arrive at a definitive answer, but in reality, there is a real art to investing, which can be genuinely difficult to accept for anyone who prefers or expects things to be black and white.

What do you enjoy most about working in business development?

I’m naturally analytical and spend lots of time staring at spreadsheets, so having the opportunity to step away from the screen and interact with people and build genuine relationships has been extremely rewarding. I’ve already learned a lot about connecting with people on a deeper level and understand why culture and rapport matter so much in the industry.

Describe the most bucket list-like moment you have had so far in your life.

Completing the Marmotte Gran Fondo, a gruelling but extremely satisfying mass-start cycling event that takes on four of the most iconic Tour de France climbs in the French Alps. It’s the kind of day that teaches you something new about yourself, and gives you enormous respect for what people can achieve when they share a common goal.

What skill or habit has made a real difference in your life?

Sitting still with your own thoughts. Sounds deceptively simple on face-value, but in a world where we are constantly bombarded with information and noise, learning to be comfortable in silence has become one of my most valuable and effective skills for maintaining focus and a healthy lifestyle.

View Alex’s bio

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Meet Robyn Laubscher

Robyn Laubscher — Wed, 25 Feb 2026 10:00:07 +0000

Robyn Laubscher joined our business development team last month. We asked her five questions about her first impressions, what she’s looking forward to this year, and a little about herself.

How have you experienced being part of the Denker Capital team so far?

It has been an incredible experience so far. While many companies say their people are their greatest asset, at Denker Capital this value is truly lived every day. The people culture is exceptional, and the depth of expertise and experience across the team is genuinely impressive.

What are you most looking forward to in the year ahead?

I’m really looking forward to building relationships with clients and supporting them through what will no doubt be another interesting year in markets. I’m also looking forward to spending time with the investment team and gaining a deeper understanding of how they view the world.

What do you enjoy most about working with clients?

I love the people side of the role – getting to know clients, understanding what matters to them, and being a trusted partner in their journey.

What is your idea of a perfect weekend, after a busy week?

Spending time with the special people in my life – my hubby and daughter, along with our friends and family – always makes me happy, especially when it includes some time at the beach and in the sea.

Beach, bush or city break?

I grew up in a small town close to the Kruger National Park, so the bush will always have a special place in my heart. These days I’m lucky to live close to the sea, which I absolutely love.

So, if I had to choose, I’d say bush and beach are hard to beat!

Contact Robyn

View Robyn’s bio

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A solid start to 2026 and an exciting new offshore listing for our global AMC

Barry de Kock — Wed, 11 Feb 2026 13:19:53 +0000

The Denker Global Opportunities Portfolio has had a solid start to 2026, building on strong relative performance in 2025 versus smaller-cap markets globally. Alongside this, we are pleased to highlight a new Frankfurt listing for this actively managed certificate (AMC), providing investors with the opportunity to access the strategy directly offshore.

Following a strong 2025 for the Denker Global Opportunities Portfolio, the portfolio has started 2026 on a positive note. As shown in the chart below, year to date, the portfolio is up versus the MSCI World Mid Cap Index and the MSCI World Index.

Another exciting development is the listing of this actively managed portfolio on the Frankfurt Stock Exchange during December, making it available to investors in US dollars, in addition to its existing rand-denominated listing on the JSE. This is an identical portfolio to our JSE listing but offers investors the ability to invest in US dollars. The USD-denominated portfolio has also performed well year to date, in USD.

Year-to-date performance as at 6 February 2026

Source: FactSet, UBS, 6 February 2026

The portfolio invests in small- and mid-capitalisation shares in global developed markets.

Click here for a review of 2025.

Key contributors

In absolute terms, key contributors to performance year to date have been our positions in Beazley, a specialty property and casualty insurer; Ferguson Enterprises, a US distributor of plumbing supplies, HVAC equipment and related building products; and PACCAR Inc., a US trucking and trucking-equipment business.

Beazley shares rose strongly following a take-out offer from Zurich Insurance Group announced on 16 January. The most recent offer values Beazley at approximately GBP8 billion, representing a 62.8% premium to the company’s pre-deal market capitalisation. Beazley is an excellent specialty underwriting business with a long track record of shareholder value creation. While we have followed the company for many years at Denker Capital, we only initiated a position in February 2025, having historically found the valuation unattractive. We believe this investment highlights our experience in global markets, our ability to identify mispriced smaller companies within our circle of competence, and our willingness to act decisively when opportunities arise.
Ferguson Enterprises has also added to performance, up 18% in USD terms (as at 6 February). Homebuilding and housing-related stocks have benefited from being perceived as relatively defensive amid current concerns around AI and software disruption. While these businesses increasingly use AI in areas such as pricing and logistics, their core activities face limited near-term disruption. Tech end-market exposure is limited (with data centers a modest exception), making the current rerating an interesting reversal of last year, when low tech exposure was a headwind rather than a support.
PACCAR shares have performed well on a similar theme to Ferguson, up 16% in USD terms (year to date). In addition, we are beginning to see early signs of recovery in the global trucking market, including improving freight rates and rising purchasing managers’ indices, suggesting that real-world industrial sentiment is turning more positive.

Top detractors

Our top and most meaningful detractors have, unsurprisingly, been our exposure to software and software-related names. Shares of vertical market software business Constellation Software are down 25% year to date, while SS&C Technologies, a software and tech-enabled service provider to financial services and healthcare industries, has declined 14% year to date. Although these positions are modest in size, the magnitude of the share price moves has impacted returns.

While we believe that AI remains a very real threat to many industries, we remain comfortable with our positioning in the sector. As a reminder, the portfolio remains significantly underweight US exposure – and US technology in particular – relative to both the MSCI World and MSCI World Mid Cap indices. This positioning is a direct outcome of our bottom-up investment process. As markets indiscriminately sell assets perceived as non-AI beneficiaries, we remain actively engaged and ready to deploy capital where opportunities emerge.

Outlook

Fundamentally, we remain positive on the long-term outlook for the portfolio. Our investment thesis around high-quality smaller companies remains intact, and we believe these businesses are well positioned to compound shareholder value at a faster rate than broader markets over time. Starting valuations remain attractive, both on an absolute basis and relative to still highly concentrated global equity markets. More broadly, it is encouraging to see evidence of market breadth improving, with the portfolio outperforming as leadership begins to widen.

Please feel free to reach out to discuss in more detail or to find further information about our recent offshore listing of the Denker Global Opportunities Portfolio.

Listing identifiers

The listing identifiers of the JSE- and Frankfurt-listings are included below.

Please contact us at investorrelations@denkercapital.com for more information. Alternatively, click on the links below for the latest brochures.

Denker Global Opportunities Portfolio (ZAR)

Denker Global Opportunities Portfolio (USD)

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New additions to our business development team

Nigel Barnes — Mon, 02 Feb 2026 09:37:19 +0000

As part of our ongoing focus on strengthening client engagement and support across our distribution network, we’re introducing the latest additions to our Business Development team, who joined us in January.

Robyn Laubscher has joined Denker Capital as a Business Development Manager. She brings extensive experience in the asset management and broader financial services industry. Her appointment reflects our continued focus on building strong, long-term client relationships.

View bio

Alex Hayman has joined the team as a Business Development Analyst. He supports the business development function through enhanced data analysis, reporting and insights, helping ensure we continue to deliver a high level of service to our clients.

View bio

We’re excited to have both Robyn and Alex on board and look forward to the contribution they will make.

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47.9% for 2025 (nope, not a typo)

Kokkie Kooyman — Wed, 28 Jan 2026 13:06:19 +0000

2025 was an exceptionally strong year for the Denker Global Financial Fund. Over the 12 months to 31 December 2025, the fund (A class) returned 47.9% in US dollars – significantly outperforming the fund’s MSCI World Financials Index benchmark return of 28.7%. By comparison, the S&P 500 Index, which many investors use as a benchmark and which has the highest concentration of tech and ‘Magnificent 7’ stocks, generated 16.8% over the period and the MSCI World Index returned 21.1%.

However, this is not about what we did in one year. It reflects what the global financials team has been doing consistently for over 20 years.

The past five years have been particularly good, helped by a favourable operating environment and a broad re rating of parts of the sector. That does distort the longer-term numbers slightly. But even if you strip out the most recent five years, the fund has still delivered attractive long-term returns and meaningful outperformance relative to global equity markets.

Figure 1: Annualised performance since inception vs. benchmark and MSCI World Index

Source: Morningstar, 31 December 2025. Returns for periods longer than one year are annualised. Returns are net of the A class fee of 1.25%. The highest annual calendar return in the last 10 years was 47.9% and the lowest was -17.2%. Morningstar category rank included: EAA OE Sector Equity Financial Services. Category ranks based on returns gross of fees, using oldest fee classes. Past performance is not necessarily a guide to future performance, and the value of investments/units/unit trusts may go down as well as up.

The key question is not only why 2025 was good – but why the fund has been able to outperform through very different cycles.

Putting 2025’s performance into context

The main driver of performance in 2024 and 2025 was a re-rating of banks, particularly in Europe and the UK, and to a lesser extent US investment banks.

However, that re-rating was not the result of a sudden change in fundamentals. Instead, it followed several years in which bank balance sheets and earnings quality improved steadily, even as markets were dominated by Covid-19, ultra-low interest rates, an inflation spike, sharply rising interest rates, the Russian invasion of Ukraine, AI-driven markets and President Trump’s tariff announcements, to name a few. Due to the all the noise the progress was easy to miss. For banks, the environment was fundamentally different from the years leading up to previous crises. Four structural factors mattered most:

Very low bad debt levels, a result of the regulatory discipline imposed after the 2008 Global Financial Crisis;
A strong focus on cost control, supported by ongoing digitalisation;
Wider net interest margins, as interest rates normalised after a prolonged period of negative rates; and
The end of regulatory capital build-ups after 2008, allowing excess capital to be returned to shareholders.

Together, these factors lifted returns on equity materially, enabling banks to grow shareholder value at a very satisfactory rate.

This cycle also differed in an important way. The major collapses after 2000 and 2008 were driven by excessive lending growth in the run-up to those crises. Since 2008, banks have generally been far more disciplined in growing their loan books. Without aggressive lending to fund speculative excess, the conditions for widespread balance-sheet stress simply haven’t been present.

Fundamentally, the re-rating reflected the market recognising the sustainability of the higher returns on equity.

A few additional factors supported performance during the year:

Interest rates were not cut as aggressively as expected (lower rates support growth, but rates that are too low compress margins);
Valuations were low at the start of the year, providing a favourable entry point; and
The macro environment remained relatively stable, despite ongoing political and geopolitical uncertainty.

Stock selection and geographical allocation also mattered. The fund had relatively small investments in many of the shares with large index weights, and as a result of its heavier exposure to European and UK banks, it was underweight US financials, relative to the benchmark.

Why the fund outperforms over time

The global financials team’s approach has remained remarkably consistent over time, grounded in a few core principles.

1. Experience and learning

The financial sector is complex. Poor operational and underwriting decisions are like landmines – waiting for an event that will trigger the explosion. Experience across multiple cycles helps in identifying those risks early – and, just as importantly, recognising when markets are overreacting.

A strong culture of learning underpins this experience: revisiting past decisions and understanding what worked and what didn’t.

2. Investing in businesses, not shares (as Warren Buffett says)

Investing is about buying a part in a business. We approach buying financial stocks as ownership stakes in operating businesses, not trading instruments.

Strong businesses, run by capable management teams, tend to emerge from periods of stress in better shape than before – and continue to compound shareholder value over time.

It’s about probabilities. We see it every day in the world of sport. Better coaches with better players will over time more consistently make the right decisions and generate better results.

3. Not overpaying

Since 1999, we’ve built up a deep database of banks and insurers around the world, allowing us to quickly identify and place new players, ones we don’t know and ones that are being turned around. We’ve back-tested what the hallmarks of a good financial company are, and when a good quality business is too expensive.

The investment balance of probabilities is in your favour when you get the balance right: Quality at the right price.

The contrast between JPMorgan and Barclays is a good illustration of why valuation alone is not enough.

After the Global Financial Crisis, Barclays appeared really cheap, trading at a large discount to tangible book value. However, the business required extensive restructuring, capital rebuilding and strategic repositioning, which took more than a decade to complete. For much of that period, shareholder value growth was limited.

JPMorgan, by contrast, entered the crisis with a stronger business model and balance sheet. While it never looked “cheap” on traditional metrics, it consistently grew intrinsic value through the cycle. Over time, that compounding delivered meaningfully better long-term returns.

The lesson was clear: buying deep value only works if the underlying business is sound and capable of growing shareholder value.

National Bank of Greece illustrates the other side of the valuation-quality balance.

Following years of economic crisis, the Greek banking system had been through extensive restructuring. By the time the fund invested after meeting with the management team of the National Bank of Greece, balance sheets were materially stronger, capital levels were adequate and bad debts were declining – yet valuations still reflected extreme pessimism.

Careful entry points and disciplined position sizing allowed us to participate meaningfully as confidence returned and the market began to recognise the improvement in fundamentals.

4, A clear circle of competence

In managing the fund, we operate within a clearly defined circle of competence. By focusing exclusively on global financials, the team is better equipped to understand balance sheets, regulatory dynamics and risk factors that generalist investors often underestimate.

This focus also supports better risk management – through diversification, position sizing and geographic balance – particularly in areas such as emerging markets.

5. Controlling emotions

Experience only adds value if it is paired with emotional discipline. Markets regularly overshoot – both on the upside and the downside – and financial stocks are often among the first to be sold when uncertainty rises.

Controlling emotions means resisting the temptation to chase what has already performed well, and being willing to add to good businesses when sentiment is poor but fundamentals remain intact. This discipline has been critical in recycling capital out of winners, maintaining exposure to laggards with improving fundamentals, and taking advantage of opportunities created by market overreactions.

Looking ahead

2025 was an outstanding year, but it was not an anomaly. It was the result of a disciplined, specialist approach that has been applied consistently for more than two decades.

One cannot forecast what markets will do. Markets will continue to change, and cycles will come and go. We remain focused on the same task as always, which has worked over the long term: investing in good-quality financial businesses, with strong management teams, at sensible valuations, and allowing shareholder value to compound over time.

We are really looking forward to 2026 and beyond.

For more information on the Denker Global Financial Fund, please click on the links below or contact us.

Brochure

Minimum disclosure document (fact sheet)

For more information, please see the KIID which can be found here.

Please read and understand the minimum disclosure document (fact sheet) before investing.

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Reflecting on 2025: Q&A with our CEO

Shane Tremeer — Fri, 12 Dec 2025 12:53:14 +0000

In this Q&A, our CEO Shane Tremeer reflects on the year that was, what we learned, and where we’re heading next.

When you look back at 2025 as a whole, what stands out most to you?

A year with a dizzying number of highs and lows. Looking back, we see stellar market performance, the ZAR at a three-year high, a ratings upgrade, lower interest rates, and the extremely successful hosting of the G20. Yet, this didn’t play out in a straight line. Remember Liberation Day and the tariff tantrum in April, when the worst was expected and priced into most global assets except gold? That was only eight months ago!

What surprised you this year, whether in markets or inside the business?

The resilience of the people of South Africa, and this filters through to markets and to our own business, Denker Capital.

What do you hope clients valued most about Denker Capital in 2025?

Our accessibility (and investment returns!).

What did you learn from clients and intermediaries this year?

Trust doesn’t just happen. But if you stay the course and deliver what you say you will, green shoots of magic start appearing all over.

What did this year teach us about who we are as a business?

As we turned 10, we’ve graduated to an extent. We’re no longer a fledgling or a start-up, and I get the feeling that this is recognised by ourselves, our clients and our industry peers.

Which of our values showed up most clearly within the business in 2025?

Commitment. We’ve had our best year on record, and this required serious commitment from all staff. Everyone pitched in to make this possible.

Our vision is to be our client’s greatest discovery, and while it’d be both presumptuous and incorrect to say that we are, I think we made some really positive strides this year.

How do we plan to strengthen as a business in 2026?

We’re growing our staff complement in both business development and the investment team. We’re also running several projects aimed at improving our clients’ experience.

What’s one team tradition that always lifts the mood, no matter what markets are doing?

The Quarterly Kuier – a lunchtime tradition where individual performances are recognised, business successes celebrated, and delicious (mostly) Denker-prepared food is served.

If the team had to survive on a desert island using only the skills they bring to work, what would keep them alive longest?

Self-belief.

What’s your core message to clients as we head into 2026?

A year ago, I said: “For the first time in more than a decade, I am cautiously optimistic that we are on the cusp of a long overdue cycle of economic growth and significantly stronger markets. Why? Because periods of (relative) political stability, declining inflation and interest rates, and undervalued assets, invariably lead to increased optimism and investment, which in turn leads to economic growth, earnings growth and asset price growth.”

I may have jumped the gun in certain areas, but heading into 2026 it’s fair to say that my caution has reduced slightly, while my optimism has surged. Thank you to our longstanding clients, and a warm welcome to the many new ones that joined our fold this year. I hope I’m right about 2026.

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One year in: Global smaller companies AMC

Barry de Kock — Thu, 02 Oct 2025 13:34:30 +0000

Just over a year ago, we set out to give South African investors a simple way to access overlooked small- and mid-size companies in global developed markets via an actively managed certificate (AMC). Reflecting on the year, the Denker Global Opportunities Portfolio has navigated a turbulent market, delivered strong results, and reinforced why we believe global smaller companies remain one of the best long-term opportunities.

If you’re unfamiliar with AMCs, jump to the end of this article for an overview of what they are and how they work.

August marked the first anniversary of the Denker Global Opportunities Portfolio.

When we launched the portfolio in 2024, our vision was to give South African investors access to high-conviction opportunities in smaller global companies – an area where we have built deep expertise over more than two decades.

Now, with a year worth of performance history, it feels like the right time to reflect: what has worked, what hasn’t, and why our conviction in this part of the market has only grown stronger.

We launched this product because global small- and mid-caps provide attractive opportunities for long-term returns.

Our investment philosophy has always been rooted in fundamental, research-driven stock picking. Smaller companies, in particular, are fertile ground for this approach. We continue to believe this part of the market is primed for attractive long-term returns, for three clear reasons:

1. Smaller companies tend to offer better growth and return potential over the long run, and valuations are currently very attractive relative to their larger counterparts.

Smaller companies typically grow faster and generate higher returns than their larger peers – and today, they look even more compelling. The MSCI World Mid Cap Index currently trades at a 17% discount to the broader MSCI World Index, despite historically trading at a ~7% premium. This valuation gap, reflected in lower price-to-earnings (PE) ratios, makes smaller companies an attractive entry point for long-term investors.

A PE ratio measures how much investors are willing to pay for a company’s earnings – with lower ratios generally suggesting better value.

Figure 1: PE ratio comparison

Source: FactSet, Denker Capital, 2 October 2025

2. Despite their growth potential, many smaller companies are frequently disregarded as investor attention concentrates on the larger companies.

This has left high-quality small and mid-caps overlooked and undervalued, creating fertile ground for active managers to buy strong companies at fair prices – an advantage often not available in crowded large-cap markets.

3. The market’s attention is fixated on mega-cap stocks, leaving many excellent businesses overlooked and under-researched.

Equity markets today are more concentrated than they have been in decades. For example, the top 10 stocks account for 39.4% of the S&P 500 and 26% of the MSCI World Index, well above long-term averages. This concentration, led by the so-called ’Magnificent 7’, heightens the risk of relying too heavily on a handful of names.

Small and mid-cap companies thus offer a viable alternative to diversify some of this concentration risk away.

The portfolio has shown resilience and delivered strong returns in its first year.

Over the first year, the Denker Global Opportunities Portfolio returned 11.2% in ZAR to 31 August 2025, compared to the MSCI World Mid Cap Index at +14.2% and the MSCI World Index at +15.7%.

This outcome was achieved in a market environment that was anything but straightforward. In the space of one year, investors had to contend with geopolitical flare-ups, trade policy uncertainty, sharp swings in US interest rate expectations, and volatile currency moves. Against this backdrop, the portfolio’s resilience has been encouraging.

Figure 2: Listed price performance – 31 August 2025 (ZAR)

Source: Morningstar, FactSet, 31 August 2025. Returns for periods shorter than one year are cumulative. Past performance is not necessarily a guide to future performance, and the value of investments may go down as well as up.

The portfolio’s 1-year return of 11.2% is solid, though it lagged the benchmark for three main reasons:

The initial months saw markets rally strongly following Trump’s election win. Investor appetite for risk surged, with flows favouring mega-caps and more speculative small- and mid-cap companies. As a result, the portfolio saw a number of consumer and more value-oriented stocks (like JD Sports, Kering, Pernod Ricard) fall out of favour, selling off between 10-20%. These stocks have since recovered.
The portfolio’s holding in diabetes care company Embecta Corporation came under pressure after disappointing quarterly results in late 2024, leading to a material decline in the share price. However, our long-term investment case remained intact, and in 2025 the stock has recovered materially following improved results.
Since the fund’s listing currency is in ZAR, rand strength reduced returns. Over the year, the ZAR appreciated around 5% against the euro and 2% against sterling, which suppressed reported performance by roughly 1%.

Financials and specific stock selections were the biggest contributors to performance.

The largest contributor to returns came from our overweight in financials, especially European and US regional banks. Several factors supported this performance: strong balance sheets, improved capital returns, continued regulatory easing, and interest rate tailwinds.

At stock level, standouts over the year included:

Euronext (+57%) – the pan-European exchange benefited from robust trading activity and capital markets exposure.
Erste Group Bank (+80%) – an Austrian banking group with a strong presence in Central and Eastern Europe.
TD Synnex Corp (+24%) – a leading global IT distributor and solutions aggregator, performed strongly over the year on the back of a recovery in results and given our sizeable position was a meaningful contributor to performance.

We believe the portfolio is positioned to deliver attractive long-term returns despite short-term market swings.

While in the short run share prices can deviate materially from intrinsic value given investor emotion, our view is that over the long run, the performance of the portfolio will largely be dictated by the per share value created by our underlying companies. This can be reliably measured via either earnings per share or book value per share plus dividends over time.

Assessing this at a portfolio level over the first year of performance, our estimate of the underlying value of the portfolio was +13%. This is in line with what we believe the portfolio should achieve through the cycle and expect it to continue to compound at double digits/low teens in the years to come.

With the portfolio trading on a forward PE ratio of 14.5x at the time of writing, our view is that the portfolio remains very well placed to generate attractive long-run returns.

The portfolio remains concentrated, disciplined, and focused on overlooked opportunities.

Over the past year we’ve kept the portfolio focused and concentrated, with between 25 and 45 holdings (currently around 35). We trimmed or exited our positions in banks such as ABN Amro, Bank of Ireland, and Banco Commercial Portugues after strong rallies pushed valuations closer to fair value.

We also added to our position in Ferguson and initiated a new holding in Daily Journal Corporation (DJCO), a California-based legal-tech and publishing business once chaired by Charlie Munger. The company’s software arm, which helps digitise courts and justice agencies, is a growing and sticky business with long-term upside – exactly the kind of overlooked opportunity we look for.

Valuations, growth potential, and diversification give us confidence for the future.

As we move into the portfolio’s second year, our confidence in this strategy has only deepened. Three factors in particular give us conviction:

Valuations remain compelling: The portfolio trades at ~14.5x earnings (mentioned above), this is attractive both on an absolute basis, but also when compared with 20.3x for the MSCI World Index and even higher multiples for the S&P 500.
Growth opportunities are intact: Smaller companies continue to capture market share and compound capital at higher rates over time.
Diversification benefits are clear: With global markets increasingly dominated by a handful of mega-cap names, smaller companies provide much-needed balance and diversification for investors.

The first year has shown what is possible, and we are excited for what comes next.

Launching a new product is always a leap of faith. But one year in, we feel our conviction has been vindicated. The Denker Global Opportunities Portfolio has delivered on what we promised: a concentrated, high-conviction way to access overlooked global smaller companies.

By sticking to our intrinsic value philosophy – focusing on good business economics, quality management, and fair valuations – we believe we’re uncovering opportunities that will help build long-term wealth for our clients.

The Denker Global Opportunities Portfolio is suitable for long-term investors with an appetite for risk, looking to gain exposure to global smaller companies while investing in rands.

How to access the portfolio:

The AMC is available to investors on EasyEquities and can be accessed here. Alternatively, it can be accessed directly on the JSE via a brokerage account or stockbroker.

Product codes

ISIN: ZAE000337614

Alpha Code: DNKGLO

Product Short Name: UBS DNKGLO

Product Long Name: UBS AMC DNK GLOBAL OPP

For more information:

Please read through the latest product brochure or contact us.

A short overview of actively managed certificates:

What is an AMC?

An AMC is a JSE-listed instrument that represents a portfolio of stocks, actively managed by a portfolio manager according to a specific investment strategy. The returns from AMCs are based on the growth of the stocks in the portfolio, and they are managed by third-party professionals under a robust regulatory framework.

Typical benefits when compared to the more traditional investment vehicles, such as unit trusts and ETFs:

Smaller investment minimums.
Cost efficiency, as the costs to run these portfolios are lower.
Easily tradable and highly liquid.
Investors benefit from the portfolio managers’ ability to react quickly to market changes, as real-time portfolio adjustments can be made.
Easy access to global markets without currency conversion hassles or the need to use offshore allowances, as investments are made in rands.
Essentially, AMCs offer investors an affordable way to access global markets without the administrative burden and tax complexities often associated with direct offshore investing.

They are also well-regulated, as AMCs are issued by banks regulated under the Banks Act of 1990.

More information on AMCs can be found on the Easy Equities website.

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