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Top 5 local ETFs to invest in South Africa

by , 04 November 2021
Top 5 local ETFs to invest in South Africa
Q. “I'm looking to invest in different local ETFs other than shares and indices. What are your top local ETFs you're mainly investing and trading this year when it comes to South Africa Timon?”

A. In 2021, it's important to look at the most cost effective, easy to find and highly traded ETFs when it comes to investing and trading…

Just a reminder, an ETF is an investment vehicle that is traded on the stock exchange. Instead of investing in individual shares, we invest in a group of shares that make up an index.

ETFs are similar to Mutual Funds and Unit Trusts…

The difference is that instead of brokers creating the basket of shares, you trade local ETFs which are already listed and regulated on the JSE.

You'll find the SATRIX ETFs are a lot more cost effective and highly traded.

There are 5 main SATRIX ETFs that I invest in and even share my trade ideas through my Red Hot Storm Trader service…

Here they are…

1. Satrix 40

This ETF makes up the top 40 shares listed on the JSE All Share Index 40.

2. Satrix FINI

This ETF consists of the 15 largest financial shares listed on the JSE. This includes the main local banks, insurance and other financial service companies.

3. Satrix INDI

This index is made up of the 25 top industrial companies listed on the JSE. This ETF consists of companies that make up manufacturing, construction and retail.

4. Satrix RESI

This ETF is weighted according to the top 10 resource - mining companies, mining finance, resources and exploration, resource companies.

5. Satrix DIVI

This is the more diverse ETF that contains the 30 companies selected from the JSE Top 40 and Mid-Cap indices.

They are the companies that make the index, which are expected to pay the best dividends over the forthcoming year.

With our recommended brokers like Rand Swiss and ProTrader, you'll find these kinds of SATRIX ETFs to invest and profit from…
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Q. “Thank you for the trading guides. I have gone through it thoroughly and have opened a Trading Demo Account, which is valid for 30-days.
 
However, I have a few queries…
 
1. The sent Guideline talks about a Trading Platform called "Protrader 3" under RandSwiss, but what's actually available on RandSwiss's website, which is also what I used to open the demo-account is "Velocity Trader".
 
2. Within this "Velocity Trader" platform, when one is given the signals to place their trade, there are these confusing fields and I don't know what to do with them or what to put in these fields:
 
a. Quantity:
 
b. Limit Price:
 
c. Trailing SL Offset: (This is NOT the SL, as it has its own separate field) 
 
I am ready to try out the demo first to get the hang of things, but I first need clarity to the above questions”. 
 
1. Hi George, yes valid questions and I’ll answer them as best as I can in order.
 
We offer three different brokers when it comes to trading…
 
ProTrade, GT247.com and Rand Swiss…
 
ProTrade is a division of FinovaCapital. They offer the charting platform called ProTrader. This platform offers a wide range of instruments, shares, ETFs, derivatives, Forex and commodities.
 
Initially, Rand Swiss (our third recommended broker) was using the ProTrader platform. They then changed to another charting platform called – Velocity Trader.
 
Velocity Trader has a variety of features, high graded charting platforms and security and advanced facilitation of trade execution services.
 
Last week, we updated the Broker letter and guide, where we made the necessary changes – which will all make sense...
 
When you sign up with FSPConnect.co.za you can redownload the broker letter and guide and you’ll see the new updates and changes accordingly.
 
a. Quantity with the Velocity Trader platform – Quantity – Is basically the volume or the No. of CFDs or Shares you’ll buy or sell for each market.
 
b. Limit Price is an order in the market where you’ll type in the exact price that you wish to buy or sell your trade.
 
With trading there are two orders…
 
Market price is an order to execute at the best possible current market price.
 
And the limit price is where you limit (choose) the price you wish to enter into your trade.
 
c. Trailing SL Offset is an advanced level that will automatically move your stoploss up or down, when the market moves in your favour…
 
Note: I never use automatic trailing stop losses when I trade. I prefer to move my stop losses with my own discretion.
 
Hope that answers all your questions…
 
Trade well, 
 
Timon Rossolimos,
Analyst, Red Hot Storm Trader


Top 5 local ETFs to invest in South Africa
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