loading

The Wealth Room

news

LIVE ON EXPRESSO: Easy Mistakes When Investing

Part 1 [embed]https://youtu.be/Wp4JIqKuc7g[/embed] Part 2 [embed]https://youtu.be/Wi16cNXKAf8[/embed] Part 3 [embed]https://youtu.be/EE8Sg0SeCMA[/embed]

read more

news

The Financial Services Industry: Only serving themselves?

John Kay’s critique of the industry, Other People’s Money, looks at the need for reform to avoid another crisis. John Kay is an economist with both academic and corporate experience, and a columnist for the Financial Times. In his latest book, Other People’s Money (R452, Takealot.com http://www.takealot.com/other-people-s-money/PLID34890927),  Kay positions himself as a critic of the current incarnation of the financial services industry, suggesting that its usefulness to society has failed to keep pace with its size and the scope of its involvement in the economy. The financial sector serves society and the economy in (at least) four ways. The payments system enables businesses and individuals to pay and receive wages and to buy goods and services. The sector also enables eff

read more

news

Banks: Long-term value outweighs the risks

Despite the meaningful risks looming over South Africa’s banking sector, the current combination of attractive dividend yields and relatively cheap valuations presents attractive prospective medium-term returns for investors in local bank shares, despite fairly muted earnings growth expectations in the low- to mid-single digits, according to Craig Butters, equity portfolio manager and banking sector analyst at Prudential Investment Managers. Banking stocks fell sharply in December 2015 on the back of the large jump in bond yields in reaction to the surprise firing of Finance Minister Nene, to levels well below their historic valuations. They have remained under pressure due to the increased risk of a downgrade of South Africa’s sovereign foreign currency credit rating to non-investm

read more

news

What is the best investment option for you?

The first thing that you need to establish from the beginning is what your investment objective is, once you have established that, you can go through a process of elimination to determine what the best Investment Product or Investment Vehicle will be for you to achieve your investment objective.     Once you have determined what vehicle you will be using, you can then determine what sort of risk tolerance you are willing to take off with the underlying unit trust. The longer your investment time horizon (interment period), the higher the amount of risk you can afford to take.   How do you choose the right products that meet your needs? In some cases you might have more than one product that might meet your needs, so you will then look into what your personal p

read more

news

The best unit trusts to suit your needs

Investment philosophy and ethics There is no one-size-fits-all option when it comes to unit trusts, as we all have different personalities and investment goals. Start by looking at the top asset managers in your country with excellent reputations. In South Africa, we recommend looking at Allan Gray, Coronation, Prudential and Investec to get you started. Then do some research on each company’s investment philosophy (how they buy and sell asset classes or shares to make you money) and see if you agree with their philosophy or not. After all, there's no point in investing in companies when you don’t believe in their ethics or investment philosophy.   Age is important The younger you are, the more risk you are able to take when selecting a unit trust. The reason for thi

read more

news

Introduction to Investment Products

So what is an investment product? We have chatted in depth about unit trusts, so I am hoping that by now you are more confident in your understanding of them. So let’s start chatting about the different investment vehicles or investment products that you can use to buy into different unit trusts. Every investment vehicle or product has been designed for a very specific purpose or goal. The underlying unit trust will be the same, but will be governed differently according to the investment product rules.   What do the product rules define? The rules of each investment product will determine how that specific investment vehicle is allowed to operate. For example, the rules can determine the contributions that you’re allowed to make to the investment product. Another on the

read more

news

Endowments

If you have an income tax rate that is higher than 30%, an endowment fund could work out to be beneficial for you as there are tax benefits within the endowment if your tax rate is higher than 30%. The other area that an endowment will help is in estate planning, as you can nominate beneficiaries to an endowment and in the event of your death the funds will be paid out to the beneficiary straight away, without it being caught up in the wounding up of the estate. The value of the endowment will still be included in your estate for the calculation of estate duty, but the endowment policy allows your estate to save on executor’s fees. How is your investment taxed? With regards to any investment return, both the interest and capital growth would be included in your taxable income an

read more

news

Best Investment Option for You

What is the best investment option for you? The first thing that you need to establish from the beginning is what your investment objective is, once you have established that, you can go through a process of elimination to determine what the best Investment product or Investment Vehicle will be for you to achieve your investment objective. Once you have determined what vehicle you will be using, you can then determine what sort of risk tolerance you are willing to take off with the underlying unit trust. The longer your investment time horizon (interment period), the higher the amount of risk you can afford to take. How do you choose the right products that meet your needs? In some cases you might have more than one product that might meet your needs, so you will then look into wha

read more

news

Become an Investment Specialist Today!

Yes you can become an investment specialist today! After going through Asset Classes last week, there is just one quick thing we need to look at before we move on to investing into Unit Trusts. I touched on Asset Allocation briefly in the last post, so in this post I will go through Asset Allocation in a little more detail so that you can build a better understanding and knowledge base. Asset Allocation:  Asset Allocation is how you divide your investments between the Asset Classes. So it is deciding how much cash, bonds, property  and equity you want in your investment. Asset Allocation is, in my opinion, one of the most important decisions you make when it comes to investing and achieving your investment goals. Before you go ahead and select which bonds, equity etc you want

read more

news

Change the Way You Invest by Understanding Asset Classes.

If you have an understanding of the different asset classes, it will help to change the way that you invest! Now that we have had an in-depth look at what the stock market is all about, we can move onto Unit Trusts as the next topic or investment vehicle (investment option). Before I do this we need to rewind one step quickly and talk about something that is called ASSET CLASSES. The reason, for this, is because without this foundation information, we will not understand how most investment options are structured. I encourage you to come to grips with the term ASSET CLASSES and ASSET ALLOCATION, as this will play a major role in setting up a successful investment portfolio for yourself. Before we can really go in depth for selecting the right funds for your portfolio, we need to underst

read more

news

Tolerating Volatility

Tolerating or taking control of volatility in your investment Every investment has varying degrees of volatility over the period of the investment. Understanding your investment goal (time that you have to invest and what return you need to achieve during that investment) can reduce or manage the amount of volatility that you would need to take in any give investment. The best way to control volatility is by understanding the risk that is attached to each investment and then investing in that specific investment for the appropriate amount of time, to make sure that over that period you get a positive return and not a possible negative return. For example, if you have 10 years to invest for a specific goal, you have plenty of time for the investment to give you a positive return. H

read more

news

Introduction to Investing

What is investing all about? With this post let’s go right back to the very beginning of the ABC, DOE RAY ME of investing and let’s chat about what Investing is all about. When we invest money, what our main objective is, is to buy something that you believe will give you a bigger return than if you had to keep your hard earned money in your bank account or in many cases under your pillow. Let’s look at Investment return and the possible risk linked to that. When we talk about investment return what we’re talking about is the possible profit that you can make in buying something at a certain price and then hopefully selling it later at a higher price. The profit that you earn on the investment is known as the return on the investment. Have you ever heard of the phrase, h

read more

news

Investment Return

How Do Investments Earn Return / Profit? When you start to invest, the money that you will invest is called capital. On the other hand the objects that you own, like a house, shares and Unit Trusts are what we call assets. So the money that you have is capital and the objects that you own are assets. If the price of your assets increase over the period that you own them, your capital that you have invested into the assets will then also increase. You could also get certain assets, (that I call bounce assets) that not only grow in value, but also produce an income stream during the growth phase. The income stream could be means of interest payments or dividend payments if the companies perform well over a particular period. If you combine the capital growth and the income that you

read more

news

Understanding the Balance Between Risk and Return

Understanding the Balancing Between Risk and Return Video Player Certain asset classes have the potential to deliver a great return/profit over a number of years; however the same asset classes also have the potential volatile returns over the short term, depending on how the asset classes respond to what is going on in the economy at any given time. So the high risk asset classes like equity’s are investments that you would ideally like to invest in over a longer period of time. On the other hand you can also get certain asset classes that are less risky, but the no risk no reward phrase comes into the equation on these asset classes, as the returns are much lower. A typical asset class that will fall into this bracket would be cash/money market.

read more

news

Investment Risk

What is the risk of losing your hard-earned money? Well in life there are no true guarantees, so when you enter into any form of investment you need to understand that you can do your best to calculate the risk and to make the best informed decision in entering into the investment or not. But at the end of the day there are certain uncertainties that can arise and change the picture completely. This is why, in my opinion; you want to have the experts in control of the situation, if it ever does arise. So when you enter into an investment you have to come to terms with the fact that there is a certain amount of risk involved, and each investment will have a different level of risk attached to it. However keep in mind the old phrase that if it sounds too good to be true, it most prob

read more

Tags: , , , ,

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.