Time in the market remains superior to timing the market

Gone are the days when the effects of Brexit and load-shedding made for the most prominent watercooler conversations. Welcome the COVID-19 media era, where ‘watercooler conversations’ happen online, and crisis and fear-gripping headlines are the new order of the day. Indeed, we live in remarkable times where a new chapter in history is unfolding before our eyes, bringing with it a unique set of challenges.

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South African Reserve Bank Interest Rate Cut

On Thursday the 19th of March, the governor of the South African Reserve Bank (SARB), Lesetja Kganyago, announced a reduction in South Africa’s repo rate by 1% from a level of 6.25% to 5.25%. The repo rate is the interest rate at which the central bank lends to other commercial banks. This significant move from the central bank followed the cut of 0.25% towards the beginning of 2020 and is the first time that the bank has reduced interest rates at consecutive meetings since 2011.

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POLITICAL COMMENT

Just do something’ is the cry now rising from all over South Africa, a plea to the president and government in general to take some action to break the logjam in which the country finds itself. Confidence is low, growth sluggish, and emigration high. It is useful to replay what has been done.

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The dash for cash

The end of the calendar year often leads to reflection on how one’s investments have performed. Many savers are questioning the wisdom of investing in South African equities after a lean period, especially relative to what must currently feel like the safe haven of cash.

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Why cash can be the riskiest asset of all

Every investor would have heard of equity and listed property referred to as ‘risk assets’. They would also have seen a graph which shows the relative risk of different asset classes, with cash at the bottom as the ‘lowest risk’ and equity at the top as ‘highest risk’. Intuitively, this also makes sense.

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Disappointing markets call for a cool head

Most investors have been disappointed with returns over the past three years. For example, multi-asset portfolios have struggled, with the average SA Multi-Asset High Equity unit trust posting 3.4% per annum over the three years ended March 2018.

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Long Term Investing

Karl Leinberger, Chief Investment Officer at Coronation Fund Managers, shows us why returns are anything but linear and hence long term investing is the

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