Netflix over the past few years has become part of every avid TV viewer’s life. Many of us are subscribers and we find that the content is just so much better than our previous satellite TV content provider. In addition, anything on Netflix is available on demand when we want it, no more waiting for our next favourite series episode to be aired in accordance with a prescribed schedule. With this convenience arrived a new phenomenon known as “binge watching” where some of us would do nothing on a weekend but binge watch through a whole season of a series. I have even heard of someone taking leave to watch all the seasons of a series!
There are an increasing number of individuals looking to expatriate their local funds (in rands) to foreign currency (US dollars, UK pounds, euros etc). This is for a host of reasons such as:
Income funds have been around for quite a while and subjectively became part of an investor’s tool kit. Several investors rope in income funds with a goal of capital preservation and steady capital growth. Arguably, the inclusion of an income fund brings diversification, which is instrumental in the overall growth of the investment. This article seeks to lay out the underlying reasons why an income fund is necessary for your investment objective.
First and foremost, an income fund is universally defined as a conservatively managed unit trust or exchange-traded fund (ETF) that places emphasis upon current income as opposed to capital gains. In general, income funds have a huge holding in fixed income instruments, preferred stocks as well as money market instruments and a moderate holding in dividend-paying stocks. However, the structure of each fund varies based on the underlying investment objective of the fund manager.
The Global & Local Asset Management Team have been completely fascinated with the events occurring throughout this COVID-19 Pandemic.
Yes, we are all nerds with a keen interest in statistics!
Occasionally we come across something topics that grab our attention which send the team into analytical mode to investigate and research more.
A few weeks ago, our Chief Investment Officer, Carl Isernhinke approached me about an article he read about online traders vs professional investors and decided this was a topic he wanted to learn more about.
I left Carl alone on this, knowing that he would bring this to my attention once he was ready.
An e-mail arrived on my desk, from Carl and attached was is a 15-page research piece entitled “Robinhood vs. The Sherriff (Sage) of Omaha!”.
Let’s face it, price is a determining factor for most goods purchased. Therefore, price acts as a measure of quality. Generally, the higher the price the greater the quality perceived. But how do we determine the price of goods that we purchase?
These questions can be extended to the prices of stock exchange-listed shares.
I have decided to narrow my thoughts on, how shares are priced. We all know that the price displayed on each listed stock includes all the known information about the share. Any information that is unknown is considered as an immeasurable risk. Immeasurable risk if deemed material, has the propensity to either move the share price up or down unrealistically.
I normally write seriously technical articles about market trends, investment performances, portfolio management and so on.
Now whilst these topics are the bread and butter for our industry, sometimes it is good to express views about other matters.
During Level 5 lockdown I was working from home and this gave me an opportunity to observe how different business owners were reacting to the lockdown restrictions.
With much of the world in lockdown I, like everyone, saw many jokes being bandied about, with reference to the lockdown in many countries (You know those jokes sent to your phone on WhatsApp). I received many that made me cringe and some made me smile and some even warmed my heart.
Cyril Ramaphosa has arguably delivered the gold standard in leadership when it comes to South Africa’s response to the COVID-19 pandemic. He has acted rapidly and decisively, following international best practice.
The socio-economic ramifications of the timely response to the crisis now need to be dealt with. The choices that are being made now, and the political outcomes that will follow are critical to determining South Africa’s future.
As promised, the following is part 2 of our article sent on Monday, 6 April;
Investing Vs Speculating Part 1.
On the whole, investment institutions achieve the impossible. Think about it…
Investment institutions have to achieve capital growth, by not risking your capital that is invested with them. We know by nature that investing can be risky, you must take some risk to achieve growth even in an interest earning bank account you are taking some measure of risk. Guarantees are never really guaranteed.
For this article I really want to step aside for a little time from the COVID-19 discussions and predictions about how the effects of this virus is going to affect the economy.
So, I thought I would go back in a way to investing 101.
Please note that this is a 2 part article, so look out for part 2 to follow in the next few days.
I was recently sent a question by a publication, posed by one of the readers which asked whether it would be prudent at this time to access capital out of mortgage bond of a rental property and invest this capital offshore?
My response was appropriate, but it got me thinking about the difference between investing and speculating. In my mind the reader’s question was going into the realm of speculation rather than a disciplined investment strategy.
“Are governments and central banks treating the stock markets when they should be treating virus?”
I recently came across a really interesting article written by Mr. Julian Koski, Chief Investment Officer of New York based asset manager, New Age Alpha, in his CIO Outlook dated 16 March 2020.
New Age Alpha is an asset manager based in Rye, New York. Their view is that financial markets are moved by human biases and it is these human biases that cause markets share prices to become too high for the management of the listed company to be able justify the share price of the company or conversely when share prices are to low and the management of the company can easily justify the share price of the listed company it is at this stage that the share price reflects a buying opportunity for the investor. They refer to this approach as “Avoiding the H-Factor” H-Factor being a shortened version of Human-Factor.