Investors urged to rebalance portfolios as equity rally loses steam

INVESTORS in the Nigerian capital market have been advised to rebalance their portfolios and increase exposure to fixed-income, money market and alternative assets as the strong rally recorded in the equities market begins to moderate.

The call was made at the Coronation Media Parley 2026, held in collaboration with the Capital Market Correspondents Association of Nigeria (CAMCAN).

At the parley, themed: “Positioning for the Second Half: Market Outlook, Capital Flows and Investment Opportunities”, investment professionals at a capital market panel session, cautioned investors against relying solely on equities, following the market’s strong performance in the first seven months of 2026.

The panel noted that the Nigerian equities market’s 57 percent year-to-date rally as of the end of July, may not be sustainable in the remaining months of the year, making asset allocation and liquidity management increasingly important for investors.

Speaking on investment opportunities for the second half of the year, the CEO of Coronation Wealth, Izekeo Adegoke, said investors should focus on balancing their portfolios across equities, fixed-income securities and money market instruments rather than concentrating their investments in a single asset class.

According to Adegoke, the strategy should be to determine how much of an investor’s portfolio should be allocated to fixed income, equities and money market instruments in a way that supports sustainable wealth creation.

“It is about how much do I have in my fixed income; how much do I have in equities; how much do I have in money markets spread across, such that it’s not about did I make a 30 per cent increase. It’s about did I grow wealth in alignment with what inflation is saying,” she said.

Identified declining inflation and the possibility of lower interest rates as factors that could create opportunities in fixed-income securities, Mayowa Ikotun, Head of Coronation Infrastructure Fund, urged investors to take advantage of prevailing fixed-income yields before a further decline in inflation and yields.

He explained that if inflation continues to decline, yields are also likely to moderate, making it attractive for investors to lock in current yields.

“As inflation continues to drop, yields continue to stem down. So, if you have a lot in fixed income now, as the yields drop, you get more returns in terms of the value of your fixed income,” Ikotun said.

He added that money market instruments remain attractive because they provide liquidity while current yields remain relatively high.

While highlighting infrastructure funds as an alternative investment opportunity for investors seeking long-term returns, Ikotun noted that the Coronation Infrastructure Fund is currently raising capital for its Series 2, with funds to be deployed into critical infrastructure projects across the country.

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He said the fund benchmarks its returns against the Federal Government of Nigeria’s 10-year bond plus a premium while also contributing to the financing of infrastructure development.

Meanwhile, the panel identified growing domestic participation as one of the major drivers of the equities market this year, following a decline in foreign investor participation.

Adegoke said increased participation by domestic investors reflects growing confidence in the Nigerian capital market, supported by improved transparency, regulatory developments and stronger investor awareness.

While predicting that foreign participation could improve towards the end of 2026 and into 2027 if the country’s macroeconomic stability continues and listed companies sustain strong growth, Adegoke said foreign investors were likely to be encouraged by the strong performance of domestic investors and the continued emergence of companies with attractive growth prospects.

Beyond conventional asset classes, Bayo Adewole, Chief Executive Officer of Trium, the venture-building arm of Coronation Group, identified digital assets and trade receivables as emerging opportunities capable of attracting institutional capital and creating new avenues for capital formation.

Adewole disclosed that some of the company’s portfolio businesses were approaching break-even while providing market infrastructure services.

According to him, institutional investors are increasingly interested in gaining exposure to digital assets but require appropriate institutional structures, risk management and governance frameworks before committing capital.

He said increasing regulatory clarity around digital assets was creating opportunities for institutional participation.

“Within the next two to three years, we expect that all of these opportunities will be at the stage where they’ll be able to engage the market from a capital formation perspective,” Adewole said.

He explained that some of the businesses could initially access short-term funding through commercial paper before eventually becoming candidates for primary listings after establishing sufficient operating track records.

Adewole also identified trade receivables as another major opportunity, noting that delayed payments currently lock substantial liquidity in corporate balance sheets.

“Imagine what would happen if we can unlock that N10 million on day two, post fulfilment of the service or product,” he said.

He disclosed that Trium had incubated a business around trade receivables and was engaging relevant stakeholders to develop the market at scale.

The panel therefore urged investors to look beyond short-term market gains and focus on diversified portfolios capable of preserving and growing wealth across different market cycles.