As I predicted last year, 2016 was a year of consolidation. Our market went nowhere. But shares are much cheaper today than they were a year ago.
And that makes me optimistic about 2017.
But there's one industry in particular that I've got my eyes on.
It was arguably the worst sector for 2016.
One of the worst droughts in decades hit South Africa. Farmers lost crop... ››› more
“Francois, our neighbour wants to sell his house. We'd like to build a little property nest egg of our own. Should we buy his property?”
That's a question I received from a family member over the holidays.
I'm sure you've been faced with a similar situation.
Looking at a property that's for sale and wondering whether it would be a good idea to buy it and get started with your very own... ››› more
When you first decide to invest in a property the excitement pumps you up. Your heart starts racing, you already see the cash rolling in…
But before your ambitions run away with your good judgement you should take a step back and evaluate whether the property you're looking to invest in will provide you with growth - or is it a cash-trap that'll suck your wallet dry.
What to look for in ... ››› more
The producer price index, non-farm payrolls, new housing starts, gross domestic product….
The list of economic indicators released monthly is massive.
The South African Reserve Bank alone releases a four-page report with more than 110 different economic indicators each month. That's not even considering international indicators.
So, which of these indicators should you keep an eye on, a... ››› more
The JSE All-Share Index is just 10% off from its all-time high.
It's sitting around the highest PE level of all time for the index, at 23.24.
At the same time, US markets are at all-time highs, and interest rates are threatening to go up.
With this in mind, I was recently asked by an investor, whether the JSE is overvalued and set for a massive correction.
So, should you hold on or sel... ››› more
“Trump will be great for business”
“Trump will make you, and me, richer”
“15 industries that will be affected by a Trump presidency”
Trump. Trump. Trump.
It's the buzz word right now.
Everyday there's a new article on Moneyweb, News24 and Bloomberg telling us how Trump will affect business, the stock market and even the world.
They're telling you this, without a clue ... ››› more
I bought my first rental property at the age of 22. Luckily it turned out a great investment.
But since then I've learnt a lot.
Truth be told, there's a heap of things I wish someone had told me about when I first got started in property back then.
The time, the money it could've saved me... I sure as heck would have gone a lot further a lot faster if I'd had a clue about some things.
... ››› more
Over the past six years I've worked with many estate agents looking to manage my rental properties. And whenever it took time to fill up an empty apartment they'd tell me “the market is slow this time of year”.
They weren't all lying to me. Considering the post-2008 property market it hasn't been smooth sailing for anyone.
South Africa's economy is struggling and people are finding it ha... ››› more
Dischem is due to list on the JSE on 18 November 2016.
The company shared that it'll probably list at a price of R16.25 - R20.25. If demand for its shares is too high, it could increase the listing price.
Now, I must say, Dischem is a great business. It's doubled its number of stores since 2010, and tripled them since 2008.
It's clear that Dischem can take major market share from other co... ››› more
Right now, there are at least 26 suspended shares on the JSE.
If you own one of them, you'll know you can't sell your shares and there's no hope of growth coming from them.
If you're incredibly lucky you might receive cents on the rand for your investment.
But, if history is anything to go by, your cash will be tied up for years, and you might as well write off your entire investment!
... ››› more
On 29 September 2016 Wescoal announced it would issue 124,995,373 new shares to a BEE investor, for an amount of R211,410,862.
At the time Wescoal's entire market cap was R440 million. So this is a big deal - it is nearly 50% of Wescoal's total share capital being added.
Usually a deal that dilutes earnings as much as this one will, is a bad thing.
Shareholders don't like it.
But since... ››› more
I'm sure you've seen what too much sugar does to a three-year-old…
They become hyper-awctive. They stop listening to all reason.
And as soon as the effect of sugar wears off, they hit a low. Until the next hit of sweetness.
You might be doing the same thing to yourself when you invest.
No, it's not that you're adding too much sugar to your coffee.
The mistake you might be mak... ››› more
South Africa sits with the ‘achievement' of having 8 out of the world's ten deepest mines.
While this is clearly an achievement in engineering - it's a problem specifically for our gold mining industry.
Production costs have skyrocketed, accidents in the deep mines make it even more difficult to profit.
In fact, in the 1970's South Africa produced as much as 80% of the world's gold,... ››› more
The JSE All Share Index is up 1% for the year so far.
The Top 40 index, representative of the most ‘stable' shares on our market is down a miserable 2.25% since 29 December 2015.
And our economy is struggling.
It's fair to say that 2016's been a tough year. Many companies are losing money (or at least making smaller profits), and very few shares are up.
But there are a select gro... ››› more
Most types of risks for investors are almost impossible control.
Take politics for example - You have no control over what the Government says or does that could affect the markets.
But there's one type of risk an investor can control - The risk of paying too much for a stock.
Let me explain…
------- Special Announcement -------
This ... ››› more
I'm not about to go into a political rant about the violence on university campuses or about the pros and cons of having free higher education for all.
What I want to talk about is the newest campaign that just happened - on the back of #FeesMustFall. It's called #DataFeesMustFall!
Thousands of people are unhappy with the data fees they're being charged by South African cell phone ... ››› more
Since the start of 2016, Silver rose from $13.82 an ounce to a high of $20.63 - an incredible 49% return!
Compare that to gold which is up around 25% and the JSE All Share which has returned just over 6% for the year.
So it's no secret that silver is one of the best performing assets in 2016. But recently, silver took a knock and it's sitting around $18.85 today.
The main factor that c... ››› more
I'm really concerned…
I just came across a group of investors. 29,595 people to be exact.
These investors are all part of a group called “It's all about Online Stokvels”.
Don't get me wrong. A stokvel is a great thing. A group of people putting their funds together, investing it, and sharing the returns when they're needed.
But what I've seen on this group isn't real ‘Stokve... ››› more
When you think of Europe's fastest growing economies, who comes to mind?
Switzerland?, Germany?, maybe Netherlands?
No it's none of them.
The fastest growing economies in Europe consist of countries you don't hear much about in the news. I'm talking about Malta, Luxembourg, Romania and Poland.
These countries' economies are expected to grow more than double the Eurozone's in 2016 and b... ››› more
In 2013 I warned investors that African Bank's drop in profits was the first ‘symptom' of a slow puncture for the South African Debt Bubble…
I told investors I believed many of the unsecured lenders and credit retailers will get themselves into trouble, but Capitec would prevail.
At the time African Bank traded at R22 a share.
By early July 2014 I called African Bank's imminent bankrupt... ››› more
Disclaimer Note that FSP Invest, a division of Fleet Street Publications (Pty) Ltd, is a research house and not a registered broker, financial advisor or financial service provider. Our editors and customer services teams also do not give personal investment advice. The advice in this website is general advice only and may not be appropriate to your particular investment objectives, financial situation or particular needs, so before investing or if in any doubt about your personal situation, you should seek professional advice from a stockbroker or independent financial adviser authorised by the Financial Services Board.
We research our recommendations and articles thoroughly, but disclaim all liability for any inaccuracies or omissions found in this publication.
Remember: Never invest more than you can afford to spare and that the value of any investment, and the income derived from it, can go down as well as up. The past is not necessarily a guide to future performance.
Editors or contributors may have an interest in investments commented on in this newsletter. However they have signed restraints to prevent the abuse of their position as contributors to this publication.