Q1 GDP coming out at -2.2%, the worst since Q1 2009, reflects that the Ramaphoria optimism has not resulted in any tangible results and likely kept investors complacent.
The rand strength is hard to explain and perhaps it will weaken while investors and portfolio managers digest the impact of these GDP figures on their investments.
Look to pick up the quality rand hedges that have been sol... ››› more
Look at the graph below…
It may look like your typical graph of a company's share price, but it's not. And if it was, you'd better be worried.
But this graph actually depicts what a shrinking stock market looks like.
And right now, you need to know what it means and the investment approach you must take if you have any chance of making money from the JSE.
It... ››› more
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
A week ago I was nearly convinced low-cost RA's are the way to go. I read a well written article on the web, promoting the virtues of low-cost RA's.
The article uses the following example:
Someone has saved R3 000 every month for 40 years into a retirement annuity (RA), and earns a return of 6.5% above inflation.
If you pay an investment fee of 3% you'd end up with R3 million at the end ... ››› more
Imagine turning on the TV and finding the following Infomercial:
We are giving you the opportunity to invest in the S&P500. It is the world’s premier equity index, dwarfing the JSE. Receive dollar based returns while getting exposure to some of the world's largest and most innovative companies including Apple, Berkshire Hathaway and Caterpillar.
But that’s not all, we also gi... ››› more
One of the best parts about working for Fleet Street is being able to connect and build relationships with top global investment experts.
These are some of the brightest financial minds who help hundreds of thousands of readers from all over the world build wealth on a consistent basis.
And every single day, I'm fortunate to receive all their best inside information from Agora Financial, M... ››› more
Commodities take a step lower
Brent oil led the commodity basket lower last week, losing 8,1%; Platinum and Gold were down 5,7% and 2,4% respectively.
Although the Rand softened, the pressure was too much for the JSE All Share Index which fell 0,8%. Resources fell 5,5%, but the rest of the sectors held up well.
International indices were slightly softer across most time zone... ››› more
“Triple Witching” refers to the combined expiration of the Index futures, Index options and stock options. In the UK and US this happens on Friday's, but in SA it happens a day earlier on Thursday. The event typically creates increased market activity and in some cases volatility.
Global markets were relatively subdued for last week's expiry, the US, UK and European majors were firmer by b... ››› more
Admittedly, I expected more movement in the Rand once the cabinet reshuffle was announced. We have a saying that “the Market always knows” which seems to apply in this case.
When Mr. Nene was removed, the Rand fell 8,5% within the first few days and then extended those losses by another 10% a few weeks later. By comparison the Rand has loss only 7% so far, perhaps the Market knew that SA I... ››› more
How you can diversify yourself to safety with the ‘Rule of Four'
What do you do with your money in a crisis? Do you sell your share portfolio? Do you stick everything in a bank account, in property or in gold?
That's the question that popped up around a campfire I had going with friends over the weekend.
Considering South Africa's junk status, state capture and political unrest that'... ››› more
About 10 years ago, I gave up with investing. The returns were just too slow for my liking.
And so, trading took over a big portion of my life.
Now as you know by now I'm a trader by heart. But I also understand that I need to diversify my money for the future. Why? Well, it's better to grow my retirement kitty with multiple streams of income, rather than with just one or two.
With the st... ››› more
Investing for income is a wonderful thing.
Income is what gives you the freedom to enjoy your life.
Income supercharges your retirement savings.
More importantly, income is what you need to ensure you and your family live a comfortable life.
So what's really the best form of income?
Dividends are “rewards” you get for investing in stocks. And they're vital to... ››› more
As I write to you, I'm still working out of the MoneyWeek offices in London. Yesterday I had a chat with two of my colleagues there, Dan Denning and Nick O'Connor.
Dan and Nick head up the daily free British stock market and economics email newsletter, Capital and Conflict.
Anyway, back to the chat I had with Nick and Dan. We spoke about Bitcoin.
If you haven't noticed Bitcoin has been ... ››› more
I call it the “offshore investment conundrum”. Investors have no clue where to invest or what to invest in, leaving their cash exposed to unpredictable economic and political events. Investing in just any old offshore product will cost you time and more importantly, money.
While I admire the ambition of investors to identify opportunities elsewhere, the fact of the matter is, over half of ... ››› more
US interest rates on the rise.
Fed Chair Janet Yellen provided testimony last week indicating a high likelihood of another US interest rate hike in March. The markets are now pricing in a 0,25% hike. The US dollar is strengthening again.
Local markets were flat over the week. The All Share squeezed out a gain of 0,1%, Resources were similar and Industrials down marginally (0,5%), Fin... ››› more
JSE up 3,3%
Last week the JSE recovered from an oversold position to close the week with a gain of 3,3%. Financials gained 4,8% and Industrials were up 3,7%. Resources managed a gain of 1,5%.
DAX up 6,6%, CAC up 5.2%.
European markets breathed a sigh of relief as the Italian referendum failed, the Dax gained 6,6% and the CAC 5,2%. Italy was up 7,3% and Spain put in 6,5%
US Markets... ››› more
It's been a tough few years for the construction industry but now that Donald Trump is president of the United States things are starting to look up.
The Trump presidency is turning out to be very bullish for the equity markets and especially the construction sector which will be helped by the new fiscal policy stance.
Today's FTSE 100 stock has been touted as a potential beneficiary from an... ››› 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
Over 400 years ago in 1593, tulips were brought in from Turkey and introduced to the Dutch.
Because they were unique, tulips were desired by the Dutch people, which made them fairly expensive.
One day, the flower contracted a non-fatal virus called mosaic. Mosaic didn't kill the tulips but caused different colours to appear on the petals, which increased their rarity and value.
Because of... ››› more
What if I told you NOT all companies that appear undervalued will make you money?
This is one of the biggest challenges investors face.
In fact, professional investors refer to such undervalued companies as “value traps”
Typically, a “value trap” is a stock that seems cheap because it's trading at a massive discount to its sector, peers or net asset value for a period of time.
... ››› more
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