Republic Equity Trust delivered standout results in 2024, posting a near 20 percent return fueled by Ghana’s resurgent stock market.
This robust performance marks a sharp turnaround from its modest 4.38 percent gain the previous year.
The fund’s net asset value climbed to GH¢16.49 million, an 18.8 percent increase. Driving this growth was a strategic shift into equities, which grew to 53.79 percent of the portfolio by year-end, up significantly from 41.80 percent in 2023.
Management capitalized on improving market sentiment and lackluster fixed-income returns. “Investor confidence in equities strengthened, and we positioned the fund to capture that momentum,” explained Madeline Nettey, CEO of Republic Equity Trust.
Ghana’s stock exchange enjoyed its best year since 2013, with the GSE Composite Index soaring 56.17 percent. Strong earnings from financial and consumer stocks, alongside capital moving away from government debt, propelled the rally.
Republic Equity Trust benefited from holdings in top performers like Unilever Ghana, which surged 140 percent, Ecobank Transnational (up over 106 percent), and MTN Ghana (nearly 79 percent). GCB Bank and ABSA NewGold ETF also delivered impressive gains of 87.4 percent and 78.7 percent respectively.
Despite soaring prices, trading volumes actually declined throughout the year. This suggests lingering investor caution amid ongoing macroeconomic risks. “Lower volumes indicate not all investors fully participated, even as prices recovered,” Nettey noted.
“But for long-term holders, the value opportunities were undeniable.” The fund maintained diversified holdings in government bonds (28.28 percent), fixed deposits (17.04 percent), and other instruments to manage risk.
Macroeconomic conditions presented a mixed picture. Inflation edged up to 23.8 percent, while the cedi faced significant depreciation pressure. Treasury bill yields fell across maturities, and the central bank cut its policy rate to 27 percent by December. These factors collectively made equities a more compelling option for investors seeking returns above inflation.
Looking ahead, Republic Equity Trust anticipates further gains in 2025. “With interest rates likely declining further and select equities poised for new highs, the outlook remains favorable,” Nettey stated. The fund will continue pursuing long-term capital appreciation through dividend-paying stocks and high-growth sectors, expressing confidence that consistent investor contributions will benefit from the projected equity upswing.