HomeHome SearchSearch MenuMenu Our productsOur products

All you need to invest is R10 a day!

by , 10 June 2013

Many of my young friends want to get in on the stock market. Whether it be the media creating a buzz about it or me constantly blabbering on about a share - most of them want to join the ‘club'. However, being young and courageous does have its disadvantages. For instance, some have just started working thanks to numerous years of studying and because of this, they're getting paid very little.

So at the end of the month, after paying for all their student loans and other expenses, they barely have anything left to save. And most of them believed investing was beyond their means.
 
That’s when I told them, all they need to start investing is a mere R10 a day!
 
A broker would probably laugh in your face with that kind of money…
 
But today I’ll show you an easy way of investing your R10 a day, effectively.
 
Why people think you need a lot of money to invest
 
If you speak to many brokers about investing, they’ll often ask you for a minimum of R10,000 or more.
 
The reason they recommend such a high amount is because if it’s less than that, the transaction fees will eat away too much of your returns. 
 
So, although you could open an investment account with less than that amount, it’ll be much harder to earn a profit after all the costs you incur. 
 
To put it into perspective, if you invested in shares with only R10 a day – or R300 per month – you would be incurring costs of at least R50. That means your costs just for BUYING a share, will chew away 1/6 (16.7%) of your investment.
 
In other words, you’d need your shares you’ve bought to rise by nearly 20%, just to break even! Which means you’d be sitting around hoping for your investment to rise to the point where you’ve neither made a profit nor a loss.
 
To me that is utterly ludicrous. And that’s why you should rather do this…

--------------------------------------

“I grew my portfolio six-fold by blatantly ignoring these popular trading “clichés””
Today I want you to do the same so you can avoid getting caught up in the web of trading misconceptions...
--------------------------------------

How to invest using only R10 a day
 
If you were to save R10 a day, or equivalently R300 a month, you could easily invest it without getting hit with the hefty charges…
 
All you need to do is buy an ETF through an intermediary like www.etfsa.co.za. This allows you to get the returns of the shares on the JSE without incurring the heavy costs. By saving just R10 a day you’ll easily have the R300 you need to start investing in ETFs.
 
What’s also great about ETFs is they offer you a well-diversified investment. So, it’s less risky when compared to buying a single share. This is because owning an ETF is like owning a small piece of many shares.
 
Most of the ETF issuers have investment plans for you and will charge you an upfront fee of 0.1%. Then they typically charge an annual management fee around 0.4%. On top of the 0.5% (0.1% + 0.4%) they’ll usually charge an investment plan fee, depending on the size, of about 0.5%...Totalling your fees to +-1%.
 
Okay enough about all these percentages! 
 
On your R300 you invest, all those fees will only accumulate to R3.50…Which is NOTHING compared to the R50 charges I spoke about earlier!
 
Visit www.etfsa.co.za and find the ETF that suites you.
 


All you need to invest is R10 a day!
Rate this article    
Note: 3.75 of 30 votes

Related articles



Related articles




Trending Topics