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While most African markets underperformed the MSCI World Index (total return) last year, if you had invested in Nigeria, you would have been a clear winner. In US dollars, the MSCI World returned +16 in 2020 compared to -9per cent for Kenya, -22per cent for Egypt and +2per cent for Morocco. Nigeria was the notable exception at +24per cent. This is according to an analysis by Allan Gray as contained in a statement made available to THISDAY. Allan Gray is Africa’s largest privately owned investment focused on generating long-term wealth for investors. “The strong performance of Nigerian equities in 2020 was driven by investors seeking alternatives to low fixed income yields and foreigners struggling to repatriate funds. But, the likelihood of a further naira devaluation remains high, so investors should remain cautious,” says Kamal Govan, portfolio manager at Allan Gray. “We expect resolution over the coming months as pressure mounts within the Nigerian economy.” ....
Why Nigeria was the all-star performer in 2020 Source: While most African markets underperformed the MSCI World Index (total return) last year, if you had invested in Nigeria, you would have been a clear winner. In US dollars, the MSCI World returned +16% in 2020 compared to -9% for Kenya, -22% for Egypt and +2% for Morocco. Nigeria was the notable exception at +24%. “The strong performance of Nigerian equities in 2020 was driven by investors seeking alternatives to low fixed income yields and foreigners struggling to repatriate funds. But, the likelihood of a further naira devaluation remains high, so investors should remain cautious,” says Kamal Govan, portfolio manager at Allan Gray. “We expect resolution over the coming months as pressure mounts within the Nigerian economy.” ....