THE value of assets administered by asset managers, or funds under management (FUM), grew by 8,34 percent, driven by a significant increase in investments in equities during the fourth quarter of 2025.
Investments in equities now account for 38,86 percent of asset managers’ combined portfolio.
According to the Securities and Exchange Commission of Zimbabwe (SecZim)’s fourth quarter 2025 newsletter, the sector’s total FUM rose to ZiG98,16 billion as of 31 December 2025, up from ZiG90,60 billion recorded in the previous quarter.Energy transition report
This reflects renewed momentum in portfolio allocations and heightened market activity.
SecZim said the growth in managed assets coincided with a notable shift in asset allocation strategies, with fund managers increasing their exposure to equities amid evolving market conditions.
“There was an increase in the sector’s exposure to the stock market, rising from 34,97 percent in the previous quarter to 38,86 percent as at 31 December 2025,” the Commission said.
Asset managers’ exposure to the property sector, historically a dominant asset class, continued its downward trend, falling from 37,29 percent in the third quarter to 33,24 percent in the period under review.
Market analysts say the shift suggests a gradual move away from relatively illiquid assets towards instruments offering greater flexibility and potentially higher short term returns.
According to SecZim, money market investments also recorded a modest increase, rising from 11,61 percent in September 2025 to 12,18 percent by year end, reflecting a continued need for liquidity and capital preservation within portfolios.
The Commission noted a slight decline in allocations to other asset classes. Investments in unquoted equities edged down to 5,01 percent from 5,12 percent, while exposure to bonds dropped more significantly from 7,56 percent to 6,41 percent over the same period.
Cash, call deposits and other investments accounted for the remaining 4,30 percent of total industry exposure.
Market observers say the growing preference for listed equities signals increased confidence in the performance outlook of companies on the domestic bourse, particularly as the reporting season begins and early results point to volume driven growth across key sectors.
Of the total FUM, US dollar denominated assets stood at US$2,66 billion, translated into local currency at the prevailing exchange rate as at 31 December 2025. The industry’s average FUM for the period was ZiG2,80 billion.
Meanwhile, performance within collective investment schemes (CIS) was mixed during the quarter, with ZiG denominated CIS funds declining by 1,36 percent to ZiG1,65 billion from ZiG1,67 billion in September 2025.
In contrast, US dollar denominated CIS funds posted strong growth, rising by 29,24 percent to US$138,20 million from US$106,94 million in the previous quarter.
The surge in hard currency funds reflects sustained investor preference for US dollar linked instruments as a hedge against local currency risks.
The Commission’s report also provides insight into investor activity during the quarter, underscoring the dominant role of institutional players in the equities market.
A total of ZiG1,19 billion worth of trades were settled through the Chengetedzai Depository Company and the ZSE Depository during the period.
Pension funds emerged as the largest buyers, accounting for 45,36 percent of total purchases, equivalent to ZiG540,09 million.
Corporations bought the second highest value of assets at 24,42 percent, worth ZiG290,80 million, while individual investors accounted for just 6,53 percent, purchasing shares worth ZiG77,74 million.
Analysts say the strong participation by pension funds highlights their continued influence in shaping market trends, particularly as they rebalance portfolios in line with regulatory requirements and shifting market conditions.
They contend that the increased allocation towards equities is likely to have supported trading activity on the local bourse, contributing to improved liquidity and price discovery in selected counters.-herald
