Navigate volatile markets with Marriott’s new portfolio

By Scott Cooper, Investment Professional at Marriott Investment Managers

In 2024, significant developments across politics, economics and financial markets underscored the unpredictability of the global landscape. Despite the highest interest rates in decades, the anticipated global recession never materialised, highlighting both the adaptability of economies and the challenges of forecasting economic outcomes. Geopolitical uncertainty remains high: volatility in the Middle East underscores the fragility of global stability, with potential disruptions to energy markets and supply chains; Donald Trump’s political resurgence emphasises the enduring influence of populism and polarised politics; and within South Africa, despite initial optimism, the inherent fragility of the Government of National Unity remains a concern. 

Uncertainty leads to quality investing

Looking ahead, global uncertainty shows no signs of abating. This has translated into a volatile start to the year for global markets, further fuelled by tariffs, trade wars, and shifting sentiment surrounding the path of interest rates. Additionally, increasingly concentrated global markets – where the ‘Magnificent 7’ now account for approximately 35% of the S&P 500 – add another layer of complexity, with any shift in sentiment having a material impact on global equity markets. In such an unpredictable environment, investors would be well-served by focusing on quality investments. This has always been a key focus of Marriott’s portfolios, where we aim to provide investors with more predictable outcomes. 

Quality investing has become a distinct and effective strategy embraced by many global asset managers. While funds in this category often share similar traits, each fund remains unique. Marriott’s newly launched Smart International Equity Portfolio harnesses this approach, offering diversified access to a range of quality-focused investment funds, with the goal of achieving robust risk-adjusted returns, greater consistency, and lower costs. 

The Smart International Equity Portfolio: 

• Focuses on quality businesses characterised by strong balance sheets, established brands, and consistent earnings. These companies tend to perform well during downturns and deliver above-average risk-adjusted returns over the long term. 
• Provides access to a diverse range of actively managed funds, including the Fundsmith Equity Fund and Dodge & Cox US Stock Fund, managed by leading professionals, extending beyond offshore options available in South Africa. 
• Blends active management with high-quality passive funds, such as the iShares Core S&P 500 ETF, which helps maintain low overall costs. 
• Diversifies risk across different fund managers, sectors, and geographies. 
• Offers tax efficiency, as South African investors will not be subject to situs tax (all underlying investments are in UK-domiciled funds in situs-free jurisdictions). Further, by opting for accumulating funds instead of distributing funds, investors can compound dividends tax-free, with any increase in value subject to capital gains tax rather than income tax upon repurchase. 
• The Smart International Equity Portfolio is ideal for investors who believe that long-term ownership of shares in high-quality businesses is an effective strategy for wealth accumulation. Its quality-focused investment strategy, along with blending the world’s best actively managed funds with low-cost passive options, offers a diversified approach to quality investing. While this makes it an attractive option irrespective of the prevailing macro-economic conditions, it is particularly well suited to navigate the current uncertain geopolitical and economic climate. 

The Smart International Equity Portfolio (SIEP) can be accessed via Marriott’s International Investment Mandate (using your annual individual offshore allowance).