When it comes to your investment outcomes, what is the one most important thing you need to get right? What is the one thing that if you get it right will give you the best chance of meeting your investment goals over the chosen time periods? What is the thing that I as an adviser … Continue reading In investing: What THE most important thing is to get right?
Much has been made of how concentrated our local All Share Index (ALSI) is and how certain companies (like Naspers) have a significant impact on movements of the index. But the ALSI is not unique. The Dow Jones Industrial Average also called DJIA, or simply the Dow, is a stock market index, that shows how 30 large publicly owned companies based … Continue reading How do you like THEM apples?
In investing there is a lot of jargon and in order to understand the recommendations which I will make when I work with you, it is important that you understand what various terms mean. Alpha A risk adjusted measure of the “excess return” provided by an investment compared with a benchmark. Alpha can be positive, … Continue reading Investing for beginners: Assets, asset classes, asset allocation & asset managers
Investors frequently want to know what return they can expect from an investment. This is a normal question and the answer is crucial in managing their expectations. An investor who is placed in a product that fails to meet their expectations is sure to be unhappy and likely to want to switch out of it … Continue reading Average returns are not normal
Diversification Diversification is strategy of investing in multiple asset classes and among many securities in an attempt to lower overall investment risk. Whilst we all know that, broadly speaking, equities return more than bonds which return more than cash over time, it is also true that these average returns are not normal. The table below … Continue reading Investing for beginners: Diversification
GMO have released their monthly forecast of what they believe the probable asset class returns will be over the next 7-years. Comment: Asset class / index views are a broad generalisation and should not be interpreted as meaning that all/every component is the same. Within each of these asset classes one will find assets which … Continue reading GMO’s 7‐Year Asset Class Real Return Forecasts
Writing in the latest PSG Asset Management quarterly newsletter my friend and former colleague, Philipp Wörz has highlighted that it's not just foreign asset managers who think that developed market valuations are starting to feel quite stretched, but local managers are very aware of this too. "Global equities have been in a bull market ever … Continue reading PSG: Be selective when investing offshore and don’t discount South Africa
I have been a fan of GMO's James Montier (and his colleague Jeremy Grantham) for some years and rarely miss an opportunity to read what they have to say. Montier's latest paper, written with colleague Matt Kadnar, is entitled "The S&P 500: Just Say No". It's a long read so pour yourself a cup of coffee, click … Continue reading The S&P 500: Just say no
According to a media release yesterday from ASISA*, living annuity policyholders withdrew on average 6.62% of their capital as income in 2016, which represents a marginal increase in the 6.44% living annuity drawdown rate recorded for 2015. An increase in the drawdown rate is concerning in an environment of relatively meek domestic returns over the … Continue reading Living annuity drawdown rates up in 2016
I attended the most recent Taking Stock presentation by Investec Asset Management on Friday morning. The main speakers were Malcolm Charles, Head of Fixed Income and Clyde Rossouw, Co-Head of Quality. Malcolm's portfolio manager duties includes the Diversified Income Fund. Clyde's portfolio manager duties include the Investec Opportunity, Cautious Managed and Global Franchise Funds. Jeremy Gardiner … Continue reading Taking stock with Investec: Going nowhere slowly but don’t bet against the pros