AXYS management is proud to announce the first annual results of AXIOM Africa Equity Fund, an investment fund in Africa open to Mauritians and foreigners launched in September 2020. In just one year of operation, AXIOM Africa Equity Fund investors have enjoyed a net return of 27.12% in US dollars. This capital appreciation is even more significant for investors in Mauritian rupees, as it reached 37.06% over the same period.
As a reminder, AXIOM Africa Equity Fund is a fund that invests in about 30 carefully selected African equities. The fund’s investments focus primarily on stocks deemed best positioned to benefit from the continent’s megatrends
the demographic boom and the digital revolution. These two medium- and long-term megatrends, which are emerging now, are the keystone of AXIOM Africa Equity Fund’s investment strategy.
“We believe that the investment potential of the African continent is historic and that an investment strategy to exploit these two megatrends is ideal for long-term investors. It is on this basis that the fund has so far delivered a return that meets AXYS’ expectations and those of its investors, while significantly reducing the risk involved,” explains Ismaïl Pomiès, Senior Fund Manager at AXYS Investment Partners.
Indeed, in one year of operation, the fund’s volatility did not exceed 10.07%, a result lower than that of the Mauritian stock market index (SEMDEX) over the same period. Since the volatility of a financial security is an indicator used to measure investment risks, this figure proves that the fund offers safe and lower risk investments.
The region’s long-term prospects are very attractive. First, the population growth expected over the next few decades is one of the strongest in the world. According to UN projections, Africa’s population is expected to more than triple over the next eight decades. At the same time, the proportion of the world’s population living in Africa will increase from approximately 1 in 5 to 2 in 5.
AXIOM Africa Equity Fund is invested in more than 10 countries across the continent, looking for regional opportunities. Investing only in listed companies, the fund’s country composition is balanced, allowing for optimal diversification of currency, political and macroeconomic risks. For example, South Africa, which traditionally dominates most investments in Africa, represents less than 20% of AXIOM Africa Equity Fund’s investments.
“The fund’s sector mix is more oriented towards industries that we believe will be the primary beneficiaries of the ongoing digital revolution, such as the financial services and telecommunications sectors. Through its exposure to consumer staples and consumer cyclicals, AXIOM Africa Equity Fund also benefits from the growing consumer base in the region. Finally, on a stock-by-stock basis, AXIOM Africa has a balanced approach where stocks are selected based on their growth prospects and valuation levels,” says Ismaïl Pomiès.
AXIOM Africa Equity Fund employs a rigorous investment process, based on robust risk management, and relies on the expertise of a dedicated investment team. Through its regional network, AXYS enables the fund’s management team to benefit from the best conditions, allowing them to achieve their risk-adjusted return objective, which opens up attractive prospects for long-term investors wishing to allocate part of their capital in this high-potential region.