Stocks, Bonds and Currencies

While 2018 may have been a bad year for African financial markets as the stocks, bonds and currency markets underperformed, the fact remains that they have provided some of the best returns in the past decade when compared with global trends.

Though the stocks and currency markets have proved often susceptible to volatility, the fixed-income segment (consisting of treasury bills and bonds) have consistently yielded solid returns by posting among the highest interest rates available globally. Yet, in this same atmosphere, very discerning investors have earned huge returns when properly guided on the political risks and important particulars on performing companies and financial instruments.

In recent years many African governments and companies took advantage of a low-interest regime in Europe and America to issue Eurobonds and other foreign-denominated debt instruments at a time interest-rate regimes within the continent were mostly on the high side. As quantitative easing ends and rates inch up, it will be important to observe closely the political and economic indicators in most of the countries for underlying factors that might determine performing and non-performing instruments.

With its in depth knowledge of African political economies, Afrika Insights is able to advise on those factors that might lead to a default on or a redemption of the investments. We also undertake sectoral or national analyses of specific financial instruments or a broad range of securities on request.