In 2024, significant developments across politics, economics, and financial markets led to some surprising outcomes, underscoring the unpredictability of the global landscape. Despite facing high interest rates and geopolitical instability, global markets delivered a gain of 18%. This performance was however largely concentrated in a narrow set of companies and sectors, and raises concerns over valuations and the long-term sustainability of such performance.
At Marriott, to provide investors with a more predictable and stable path to wealth accumulation, we focus on high-quality, well-established dividend-paying stocks. This approach contributed to decent absolute returns last year. While our equity-based portfolios may have lagged behind the AI-driven market in 2024, our investment style reinforces the case for sustainable returns in the years a head.
In an increasingly unpredictable world, our disciplined investment strategy allows us to offer investments which provide investors with the stability and resilience needed to build and preserve wealth over the long term.
2024 demonstrated how unpredictable the world can be. Events that once seemed implausible became reality, shaping the political, economic, and financial landscapes in surprising ways:
These developments indicate that we've perhaps entered an era where the unexpected has become the new normal.
Despite the unpredictability of 2024, it did not hinder global equity markets, which achieved a gain of 18% for the year. However, beneath this strong headline figure lies a striking imbalance: much of the growth was driven by U.S. equities, which surged 25.1%, elevating the U.S. to represent a remarkable 67% of the global market – far eclipsing other major markets such as China (2.8%), the UK (3.1%), and Japan (4.8%).
Furthermore, this growth was largely fuelled by a narrow cohort of technology companies. Giants like Tesla and Nvidia led the charge, with the "Magnificent 7" – a group of super-sized tech firms – accounting for nearly 35% of the U.S. market. These firms, many with market capitalisations exceeding $1 trillion, highlight a level of market concentration unseen for decades.
The dominance of just a few companies, alongside the disproportionate weight of the US in the global market, signals a potential risk to diversification and market stability.
For investment managers, this situation presents a delicate balancing act. While exposure to the world’s leading companies is important for capturing growth, it is equally important to manage risk of capital loss. The inflated valuations of some high-performing stocks raise concerns about potential downside risks. With the margin for error in these sectors growing thinner, market corrections could lead to volatility.
This can be seen in the sharp decline in the global healthcare company Novo Nordisk's market value in late 2024, underscoring this vulnerability. The Danish pharmaceutical company lost €90 billion in value within minutes after revealing it had missed internal targets for a next-generation obesity drug. While such setbacks are common in the pharmaceutical industry, Novo Nordisk's elevated valuation – comparable to that of a tech stock – left little margin for error.
This event highlights the risks of overvaluation, even for market leaders. In today's environment, where growth stories dominate market narratives, maintaining discipline and ensuring portfolios are resilient to potential corrections and the unexpected remains paramount.
Investment portfolios can vary significantly in their risk profiles depending on the types of stocks they contain:
Marriott's investment strategy centres on these dividend-paying stocks, prioritising companies with consistent growth, strong fundamentals, and the potential to benefit from key long-term trends, such as AI, in a more measured way. By prioritising reliable dividend payers, we aim to provide more predictable returns, offering a stable counterbalance to more speculative growth strategies which dominate the market today. The chart demonstrates the strong correlation between dividend growth and capital appreciation over the long term.
Although our investment approach may have caused our equity-based portfolios to lag behind the AI-driven market of 2024, it strengthens the case for an investment strategy that provides more sustainable returns, such as those we achieved in 2024.
The table below outlines the returns of our flagship equity-based funds and share portfolios for the year ending 31 December 2024.
| As at 31 December 2024 | Total Return | Income Produced# |
| 1 year | 1 year | |
| First World Equity Feeder Fund (A) | 6.3% | R21 770 |
| Balanced Fund (A) | 9.4% | R49 740 |
| Balanced Fund (C) | 10.0% | R55 480 |
| Worldwide Fund A | 6.6% | R31 270 |
| Worldwide Fund (C) | 7.2% | R37 010 |
| Dividend Growth Fund (R) | 8.7% | R35 420 |
| *Annualised #Assuming R1,000,000 invested Source: ProfileData | ||
| As at 31 December 2024 | Total Return GBP* | Total Return USD* | Total Return EUR* |
| 1 year | 1 year | 1 year | |
| IIP – Income Growth Portfolio | 8.9% | 7.1% | 14.1% |
| *Annualised Gross of Investment Management Fee Source: Bloomberg | |||
From a bond market perspective, the high yields on offer due to the continuation of restrictive monetary policy in most parts of the globe enabled attractive real returns across our income fund range as highlighted below:
| As at 31 December 2024 | Total Return | Income Produced# |
| 1 year | 1 year | |
| Core Income Fund (A) | 10.5% | R85 300 |
| Core Income Fund (C – LISPs only) | 10.8% | R88 140 |
| High Income Fund (A) | 10.3% | R83 810 |
| High Income Fund (C) | 10.6% | R86 670 |
| Income Fund (R) | 10.4% | R88 040 |
| *Annualised #Assuming R1,000,000 invested Source: ProfileData | ||
Guided by an absolute return mindset, our strategy offers investors a differentiated path to wealth building. While it may not capture the rapid gains from more speculative sectors, it is designed to deliver steady, long-term growth, making it ideal for investors who prioritise stability, wealth preservation and more consistent returns.
While we acknowledge that the biggest winners of 2024 have the potential to shape parts of the global economy, the long-term impact of AI remains uncertain. Exposure to key tech giants is important – information technology companies make up over 30% of the U.S. equity market and are often highly cash-generative. However, the rush to invest in AI has resulted in sizeable parts of the market being overlooked by investors.
We believe the gap between technology and the broader market will likely narrow in 2025. Whether this results in a decline in technology shares or growth in other sectors is uncertain, but it reinforces the need for prudent diversification. It also suggests that exposure to reliable dividend payers may become increasingly important in 2025.
A similar dynamic is unfolding in local markets. The formation of the Government of National Unity (GNU) has fuelled optimism about South Africa's future. However, while this may provide a boost, the inherent fragility of political partnerships makes any predictions uncertain. As a result, exposure to high-quality businesses in resilient industries, along with a healthy allocation to rand-hedge and offshore investments, remains essential for mitigating the risk of permanent capital loss. In this context, we continue to favour medium-term South African bonds due to their historically high real yields and because they will offer lower downside risk should the political and economic outlook does not unfold as expected.
While speculative, high-growth stocks often capture media and investor attention, their considerable volatility and unpredictability make them less suitable for investors who are focused on long-term wealth preservation and consistent returns. Though these stocks may promise rapid growth, they come with the risk of sharp downturns, which can undermine capital preservation. In contrast, our strategy is centred on steady, reliable growth through high-quality, dividend-paying companies. This approach provides investors with a more stable and predictable path to achieving long-term financial goals.
Please see the latest commentary for each fund in our recent factsheets.
| As at 31 December 2024 | Total Return | Income Produced# | ||||
| 1 year | 3 years* | 5 years* | 1 year | 3 years* | 5 years* | |
| First World Equity Feeder Fund (A) | 6.3% | 5.4% | 9.6% | R21 770 | R60 720 | R121 880 |
| Sector Average (Global – Equity – General) | 16.2% | 7.8% | 12.9% | R2 700 | R8 710 | R16 950 |
| Dividend Growth Fund (R) | 8.7% | 6.7% | 6.3% | R35 420 | R95 820 | R151 050 |
| Sector Average (SA – Equity – General) | 13.0% | 7.7% | 9.9% | R26 600 | R86 850 | R150 870 |
| *Annualised #Assuming R1,000,000 invested Source: ProfileData | ||||||
| As at 31 December 2024 | Total Return GBP* | Total Return USD* | Total Return EUR* | ||||||
| 1 year | 3 years* | 5 years* | 1 year | 3 years* | 5 years* | 1 year | 3 years* | 5 years* | |
| IIP – Income Growth Portfolio | 8.9% | 4.5% | 8.1% | 7.1% | 1.9% | 7.0% | 14.1% | 5.1% | 8.7% |
| *Annualised Gross of Investment Management Fee Source: Bloomberg | |||||||||
| As at 31 December 2024 | Total Return | Income Produced# | ||||
| 1 year | 3 years* | 5 years* | 1 year | 3 years* | 5 years* | |
| Core Income Fund (A) | 10.5% | 8.8% | 8.0% | R85 300 | R237 330 | R363 760 |
| Core Income Fund (C – LISPs only) | 10.8% | 9.1% | 8.4% | R88 140 | R245 770 | R378 030 |
| High Income Fund (A) | 10.3% | 8.7% | 7.9% | R83 810 | R233 160 | R359 730 |
| High Income Fund (C) | 10.6% | 9.0% | 8.3% | R86 670 | R241 600 | R374 050 |
| Income Fund (R) | 10.4% | 8.4% | 7.4% | R88 040 | R231 290 | R341 680 |
| Sector Average (SA – Multi Asset – Income) | 7.4% | 7.4% | 7.0% | R79 110 | R208 620 | R313 580 |
| *Annualised #Assuming R1,000,000 invested Source: ProfileData | ||||||
| As at 31 December 2024 | Total Return | Income Produced# | ||||
| 1 year | 3 years* | 5 years* | 1 year | 3 years* | 5 years* | |
| International Real Estate Feeder Fund (A) | -7.0% | -4.3% | 2.9% | R32 700 | R80 810 | R153 010 |
| Sector Average (Global – Real Estate – General) | 1.2% | -2.2% | 4.7% | R15 320 | R30 510 | R65 470 |
| *Annualised #Assuming R1,000,000 invested Source: ProfileData | ||||||
| As at 31 December 2024 | Total Return GBP | ||||||||
| 1 year | 3 years* | 5 years* | |||||||
| First World Hybrid Real Estate plc (A) | -0.4% | -1.7% | 3.3% | ||||||
| *Annualised Gross of Investment Management Fee Source: Marriott | |||||||||
| As at 31 December 2024 | Total Return | Income Produced# | ||||
| 1 year | 3 years* | 5 years* | 1 year | 3 years* | 5 years* | |
| Property Income Fund (A) | 18.2% | 6.2% | 1.2% | R67 110 | R181 230 | R239 850 |
| Sector Average (SA – Real Estate – General) | 25.6% | 10.0% | 4.3% | R57 230 | R171 400 | R220 580 |
| *Annualised #Assuming R1,000,000 invested Source: ProfileData | ||||||
| As at 31 December 2024 | Total Return | Income Produced# | ||||
| 1 year | 3 years* | 5 years* | 1 year | 3 years* | 5 years* | |
| International Growth Feeder Fund (A) | 2.5% | 2.0% | 8.0% | R23 680 | R63 020 | R126 260 |
| Sector Average (Global – Multi Asset – Flexible) | 10.7% | 6.5% | 10.1% | R2 540 | R6 960 | R13 170 |
| Worldwide Fund (A) | 6.6% | 4.2% | 7.6% | R31 270 | R88 360 | R153 670 |
| Worldwide Fund (C) | 7.2% | 4.8% | 8.2% | R37 010 | R104 910 | R186 140 |
| Sector Average (Worldwide – Multi Asset – Flexible) | 13.9% | 7.3% | 10.4% | R13 950 | R35 700 | R59 470 |
| Balanced Fund (A) | 9.4% | 6.0% | 6.2% | R49 740 | R139 430 | R222 140 |
| Balanced Fund (C) | 10.0% | 6.6% | 6.8% | R55 480 | R155 960 | R250 730 |
| Sector Average (SA – Multi Asset – High Equity) | 13.3% | 8.3% | 9.9% | R29 840 | R85 000 | R148 540 |
| Essential Income Fund (C) | 17.6% | 8.6% | 5.1% | R77 430 | R200 990 | R282 580 |
| Sector Average (SA – Multi Asset – Flexible) | 13.7% | 8.1% | 9.5% | R33 750 | R94 490 | R164 290 |
| *Annualised #Assuming R1,000,000 invested Source: ProfileData | ||||||
| As at 31 December 2024 | Total Return GBP* | Total Return USD* | Total Return EUR* | ||||||
| 1 year | 3 years* | 5 years* | 1 year | 3 years* | 5 years* | 1 year | 3 years* | 5 years* | |
| IIP – Balanced Portfolio | 7.3% | 3.4% | 7.3% | 5.5% | 0.8% | 6.2% | 12.4% | 4.0% | 7.9% |
| *Annualised Gross of Investment Management Fee Source: Bloomberg | |||||||||
Collective investment schemes are generally medium to long-term investments. The value of participatory interests or the investment may go down as well as up. Past performance is not necessarily a guide to future performance. Collective investment schemes are traded at ruling prices and can engage in borrowing and scrip lending. If required, the manager may borrow up to 10% of the market value of the portfolio to bridge insufficient liquidity. Forward pricing is used. The ruling price of the day is calculated at approximately 15h00 SA time each day. Purchase and repurchase requests must be received by the manager by 15h00 SA time each business day. Prices are published on a daily basis on the Marriott website, www.marriott.co.za. Unit trusts are calculated on a net asset value basis. Net asset value is the value of all assets in the portfolio including any income accrual and less any permissible deductions from the portfolio. Marriott does not provide any guarantees with respect to the capital or the return of the portfolio. A schedule of fees and charges and maximum commissions is available on request from Marriott. Where initial fees are applicable, these fees are deducted from the investment consideration and the balance invested in units at the net asset value. Commissions and incentives may be paid and if so, would be included in the overall costs. Different classes of units apply to the fund and are subject to different fees and charges. Declaration of income accruals are monthly. Performance figures are based on lump sum investment. Individual investor performance may differ as a result of initial fees, the actual investment date, the date of reinvestment and dividend withholding tax. Past performance is not indicative of future performance. This portfolio may be closed to new investors in order to manage it more efficiently in accordance with its mandate. The TER shows the percentage of the average Net Asset Value of the portfolio that was incurred as charges, levies and fees relating to the management of the portfolio. A higher TER ratio does not necessarily imply poor return, nor does a low TER imply a good return. The current TER cannot be regarded as an indication of future TERs. Transaction Costs are a necessary cost in administering the Financial Product and impacts Financial Product returns. It should not be considered in isolation as returns may be impacted by many other factors over time including market returns, the type of Financial Product, the investment decisions of the investment manager and the TER. Marriott Unit Trust Management Company (RF)(Pty) Ltd is a member of the Old Mutual Investment Group. Old Mutual is a member of the Association for Savings and Investment South Africa (ASISA).
Please note that where the term ‘yield/yields’ is used, these are historic yields
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