It’s exactly one month until the most important election in SA since 1994. We’ve already talked about the possible worst- and best-case scenarios of the election outcome. So today, let’s focus on the best action we can take right now to prepare our portfolios and investing for whatever the election may bring.

Here are some election moves you can make today…

Recently, Investec predicted a severe down-case scenario for South Africa, which could see the rand reach R21.40 to the US dollar in 2024. The reasons aren’t only to do with the election. While the election will play a big part, other factors such as a strong dollar, sticky inflation and the Fed keeping interest rates high will also impact the rand.

So to reiterate:

#1: Own foreign currencies – Euros, Dollars, Pounds. You can directly exchange rands for foreign currencies at your bank.

Alternatively, you can invest in Absa’s NewWave currency exchange-traded notes (ETNs).

There are three: NEWUSD, NEWEUR and NEWGBP – each track the respective currencies.

Simply, these ETNs will appreciate if the ZAR weakens relative to the respective foreign currencies.

#2: Own hard assets: Gold especially has been able to maintain its value through decades of currency devaluations. And investors also benefit from holding gold when the rand weakens.

For instance, an ounce of gold in USD has returned around 85% over the past five years. Meanwhile, an ounce of gold in ZAR has returned 150% over the same period!

Silver is also another option as its historically undervalued to gold and experiencing a supply squeeze. However, just be aware that silver is much more volatile than gold.

Over the past one, three and five years, silver’s annual return comes to 10%, 9.2% and +15%, respectively, which is solid for such an unloved metal.

#3: Own Rand-hedge stocks: these can be either SA-listed companies that operate offshore as well as companies that earn strong foreign currencies.

Either way, a weakening rand will boost revenues and profits.

That’s what this month’s issue is all about.

We’re going to look at the three stocks you should absolutely buy today. They earn hard currency, and each have a catalyst that could send their shares soaring. You may already own these stocks and that’s great. But if you want to double down on these then this is a great opportunity to do so. Get all the details in the latest issue of Red Hot Penny Shares out now!

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