06 Jun 2018
Invest local AND global
It’s easy to make investment decisions in hindsight.
For example, pundits could look at the Rand/Dollar exchange from 30 years ago and, calculating the current gains from an investment of R100 000 in Dollars (approximately 456% - not shabby), suggest that one should have put all one’s money into Dollars at the time.
But not only is that kind of advice guaranteed to upset current investors, it’s also oversimplifies decision-making that should be based on far more than just exchange rates.
When making vitally important choices regarding investing a client’s life savings, Philip Bradford, Head of Investments at Sasfin Wealth, weighs up the following considerations:
Putting patriotism aside, from a risk perspective it just doesn't make sense to leave all your wealth in one country. No matter how politically and economically stable one’s home country, it is wise to invest across a variety of investments, currencies, companies and countries.
The world is an investor’s oyster
Nowadays, South African investors have the means to consider buying shares in some of the best companies in the world. So why not do exactly that? Shell, LVMH and Diageo are leading brands that are often cheaper than local alternatives, whereas tech giants like Google, Amazon, Microsoft and Apple simply have no local peers.
Don’t forget local advantage
We wouldn’t recommend taking all one’s capital offshore – South Africa boasts high interest rates that, ironically, are a result of the same political and economic uncertainty that makes investors nervous. Carefully-selected local property companies can offer very attractive yields, thanks to local lease increments are linked to inflation. This remains much higher than in developed markets.
Any prudent wealth plan should be global in nature, which is why Sasfin’s comprehensive local AND offshore investment range includes both single and multi-asset class offerings suitable for private and institutional clients.
Learn more about Sasfin’s global strategy and investment offerings at sasfin.com/globalwealth