VFEX tipped to outperform again
…. as investors seek dollarised stability
CLOUDINE MATOLA
FBC Securities (Private) Limited has projected another year of strong performance for Zimbabwe’s equity markets in 2026, with the Victoria Falls Stock Exchange (VFEX) expected to extend its outperformance as investors increasingly favour a stable, US dollar-denominated bourse over the Zimbabwe Stock Exchange (ZSE), Business Times can report.
In its 2026 economic outlook report, the research firm said the widening divergence between the two exchanges is a direct consequence of Zimbabwe’s dual-currency system, which continues to shape investor behaviour and risk appetite.
FBC expects the VFEX to further consolidate its position as the preferred market for export-oriented companies and international investors seeking protection from local currency volatility, given its fully dollarised framework and free capital repatriation.
“Consequently, the investment thesis is split: the VFEX offers a stable, dollarised avenue for equity exposure, whereas the ZSE represents a higher-risk strategic bet on the successful stabilisation and institutionalisation of the local currency itself.
“Notwithstanding the above, we expect positive performance across both markets, with the VFEX likely to outperform again as institutional investors continue to generate and deploy USD-denominated investable funds from their operations.
“Zimbabwe’s 2026 stock market outlook presents a stark divergence between its two primary exchanges, a direct reflection of the nation’s dual-currency system,” FBC said.
The firm said while the VFEX is positioned to thrive, the ZSE faces a more testing year as its performance becomes increasingly dependent on the central bank’s success in anchoring inflation and restoring confidence in the ZiG.
“The Victoria Falls Stock Exchange (VFEX), as a USD-denominated bourse with free capital repatriation, is poised to solidify its position as the premier platform for foreign currency investments, buoyed by structural dollarisation. This hard-currency haven will continue to attract listings from export-focused sectors and serve as the natural entry point for international portfolio investors seeking Zimbabwean exposure while hedging local currency volatility.
“In contrast, the Zimbabwe Stock Exchange (ZSE), a ZiG-denominated bourse, now faces a year of fundamental recalibration; the removal of its traditional inflation-hedge premium necessitates a market correction based purely on real corporate earnings, likely compressing price-to-earnings multiples and constraining liquidity as domestic investors cautiously assess the new environment. The ZSE’s performance will act as a direct barometer for the market’s confidence in the Reserve Bank’s disinflation programme: success in achieving single-digit inflation and fostering genuine ZiG demand could gradually attract long-term domestic savings, while any loss of monetary policy credibility would severely undermine the exchange’s foundation,” FBC said.
