Holding thumbs

The year 2018 was not the best of years for many. The economy wasn’t great and investment returns were on a roller coaster of mostly downs thanks to politics and Steinhoff to name but a few. Perhaps its wishful thinking but people in the know say that 2019 will be better. Most of us are crossing fingers.
believe that there is decent value in SA equities, way better than five years ago and that investments should produce in excess of 10% p.a. over the next four years.

Local outlook
So what are the big Issues for 2019? Well, locally it’s all politics naturally.
The 2019 general election – where an IPSOS poll conducted in June 2018 suggests that the ANC could improve their majority to 60% from 54%. This should give President Ramaphosa more support to make more meaningful government changes.
Fighting the unions – this will start with government employees as expenditure needs to be redeployed into more income-producing assets, such as infrastructure. The first big battle is likely to be with Eskom where a rumoured 30% of staff could be retrenched this year.
A Moody’s debt downgrade is still unlike-y. Although it is unlikely to bring about a material increase to 2019’s economic growth (currently forecast at 1.9%), further critical government structural changes to boost economic growth should go some way to prevent an ultimate down-grade to junk status.
Let’s be frank! When investment performance is disappointing, managers look to the longer term to justify their returns. This is perfectly acceptable as it has been proven that the best returns are realised over a longer time period, +10 years. The JSE has produced a 12.7% p.a. return over the last 10 years and 16% p.a. over the last 40 years.
However, disappointment comes largely with unrealistic investment return expectations which correlates frequently with investing in an investment portfolio that does not suit your personal risk profile.
2018 was an awful year for equity markets. The JSE All Share Index was down 8.5% and the MSCI World Index was down 10.1% in US Dollars. There have been far worse years such as 2003 and 2008 where the market slumped 40% and 32% respectively. However, the big concern for some investors is that over the last five years, the SA stock market has only returned 5.8% p.a. versus inflation of 5.4%.
The bottom line is that the sluggish re-turns over the last five years, coupled with an 8.5% decline in 2018 has been a correction of overvalued markets resulting in far more attractive investment opportunities today.

Read The Full Article

  1. I found your weblog site on google and test a couple of of your early posts. Proceed to keep up the excellent operate. I simply extra up your RSS feed to my MSN Information Reader. Seeking forward to reading more from you in a while!?

  2. Thank you a lot for providing individuals with such a special opportunity to check tips from this site. It is usually so cool and jam-packed with fun for me personally and my office acquaintances to search your blog particularly three times weekly to learn the fresh stuff you will have. Of course, we are actually satisfied with your unique concepts served by you. Certain 1 tips in this post are essentially the very best I’ve had.

  3. Thanks for every one of your labor on this web page. My mother delights in engaging in internet research and it’s simple to grasp why. A lot of people learn all regarding the compelling way you convey both interesting and useful tips and tricks through your website and as well boost participation from the others about this content plus our own child is certainly discovering a lot of things. Take advantage of the rest of the new year. Your conducting a really good job.

  4. Thanks for your own efforts on this web page. My aunt loves participating in research and it is easy to see why. A lot of people notice all of the dynamic medium you offer advantageous tips and tricks by means of your website and as well invigorate response from people on that article so my daughter is understanding so much. Take pleasure in the rest of the new year. You’re performing a glorious job.

  5. I needed to draft you the little bit of remark to give thanks over again for your personal stunning solutions you have featured above. This is really generous with you to grant unreservedly just what numerous people might have supplied for an electronic book to earn some cash for their own end, mostly given that you could possibly have done it if you ever wanted. The suggestions also served to be the fantastic way to recognize that someone else have similar dreams just as my very own to grasp a little more concerning this matter. Certainly there are thousands of more pleasant instances in the future for many who looked over your website.

  6. Thanks for all your work on this website. My mum take interest in engaging in investigations and it’s simple to grasp why. My spouse and i know all about the lively form you present vital strategies on your web site and as well boost response from others on that subject so our own daughter is really being taught a great deal. Take pleasure in the remaining portion of the year. You’re the one conducting a tremendous job.

  7. I am just writing to make you understand of the terrific discovery my cousin’s girl had browsing your webblog. She figured out a wide variety of pieces, with the inclusion of what it’s like to possess a very effective giving style to make others clearly thoroughly grasp selected tortuous topics. You really did more than people’s desires. I appreciate you for imparting such necessary, dependable, informative and as well as fun guidance on the topic to Emily.

  8. I would like to convey my gratitude for your kindness supporting folks who must have help on this particular niche. Your special commitment to passing the solution all around appears to be really insightful and has really made ladies just like me to get to their targets. Your entire interesting instruction indicates a whole lot to me and especially to my peers. Warm regards; from all of us.

  9. I am just commenting to make you know what a excellent experience my wife’s child went through studying your web site. She even learned several pieces, which include what it’s like to have an awesome coaching mood to get many others really easily know precisely various specialized topics. You undoubtedly surpassed our desires. Many thanks for supplying those beneficial, dependable, explanatory and even easy thoughts on that topic to Evelyn.

Leave a Reply

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

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>