What do four of South Africa’s most accomplished female actuaries have in common apart from being ace number crunchers? They are all financially independent and empowered, but not because they are actuaries or earn good salaries. All of them learnt at an early age that it takes hard work, dedication and self-discipline to make money […]
According to statistics from the Actuarial Society of South Africa, women on average are living ...
This Women’s Month, Liberty Medical Scheme highlights five essential medical tests women should be aware ...
Offshore investing refers to a variety of investment tactics that exploit advantages accessible outside of ...
Sally is a divorced mother of four living in Cape Town. Since she had been ...
Being a financial planner in tough economic times is a big responsibility. Clients are often ...
- Q: How did you get involved in financial services - was it always something you wanted to do?
- A: As I studied actuarial science, I knew that figures and finance were definitely going to feature in my future but the investment arena didn’t actually crop up as a realistic career path in my formative years. Then, near the end of my degree I was offered the opportunity to work on a project at Old Mutual Asset Managers (now Old Mutual Investment Group) for a month. While completing the project the bug bit me and it became crystal clear that my path lay in investments. From that point I worked hard to develop my skills in this direction.
- Q: How much of a successful investment is down to skill and how much is luck?
- A: The beauty of the industry is that there isn’t one clear formula for success. Many investment managers from diverse backgrounds and with various skill sets have succeeded. What is a constant is that, in order to have longevity in the industry, it is vital to have a solid investment philosophy and a repeatable process. This doesn’t mean that you will outperform over every time period, but it should lead to superior results over the long term, which is the true test of skill. That said, luck does play a role, but I feel it diminishes as a driver of success with time. An analogy I came across some time ago is that you may be able to beat Tiger Woods in one round of golf, but to beat him over four consecutive rounds is far more difficult, if not impossible, for the average golfer. In other words, luck can only take you so far, skill is what truly counts.
- Q: What in your view is risk and how should investors consider risk?
- A: It’s very easy to throw numbers about when it comes to risk – usually if you can quantify something it becomes easier to understand. But numbers, especially summary statistics such as risk numbers, can be dangerous. The usual risk statistics that are bandied about allow for risk measurement, but they do not help you to understand risk. Importantly, there are many types of risk when it comes to investing, so it is important to start with how a particular manager defines risk. Risk, as defined by MacroSolutions, is the chance of not delivering to our clients’ expectations. With this in mind, knowing what you are trying to achieve and how long you have to get there are the key variables. If it’s likely you will need to disinvest within a short period, then it will be risky to invest in portfolios that aim to deliver the greatest long-term real returns (typically high equity investments). The longer your time horizon, the more you should be prepared to tolerate the possibility of short-term capital losses inherent in equity-type investments. But there is no escape from risk and investing in low volatility assets (like the money market) for a long time creates a different type of risk i.e. the risk of not achieving real returns on your savings. This is especially true in the current low interest rate, high inflation that characterises the SA economy. In fact, to me, erosion by inflation is a bigger risk than incurring a few short-term negative periods in a diversified portfolio that is invested for the long term.
- Q: What has been your best investment experience and what was your worst investment experience?
- A: While there have been many great experiences over the last 14 years, the best relates to the launch of a new fund, Edge28, in 2011. This fund was launched following the amendments to Regulation 28 of the Pension Funds Act. It has grown to over R 1bn in its short life and has delivered great returns to our clients. One of the most exciting aspects of this fund, for me, has been the exposure that I’ve gained to the worlds of private equity and hedge funds, both of which comprise sizeable portions of this fund. The global financial crisis in 2008 stands out as my worst experience. But, while it was a difficult time for investors, it gave me the chance to learn a lot about myself, my colleagues and our clients. When everything is going well, it’s easy to become complacent. It’s when the tide turns that your philosophy, process and team dynamic are really put to the test.
I am busy reading Kevin Lings’ excellent book The Missing Piece. A highly recommend. Lings highlights how critical the employment issue is in SA – we don’t have enough of it – by a very wide margin. In SA – whichever number you choose to look at – unemployment is high. It will take a […]
Spreading unsubstantiated rumours around the nationalisation of pension funds is reckless and harmful to workers who are said to be resigning in mass to obtain their pension money for fear that government’s proposed retirement reforms will see their savings expropriated. Hannine Drake, Senior Associate at pan-African corporate law firm, Bowman Gilfillan, commented, “Workers must be […]
In light of the Financial Planning Week, scheduled to run from 25 – 29 August 2014, the Financial Planning Institute (FPI) alongside the financial services industry will be offering FREE financial planning consultations to consumers. The nationwide joint industry initiative encompasses a variety of sub campaigns that will run regionally and aimed at educating South […]
Financial Planning Week: 25 – 29 August No matter where you fit into the South African job market – whether you’re taking your first step on the corporate ladder, a labourer in the workforce or a CEO of a large corporate – when it comes to offers of credit, everyone is a target. So says […]
The significant weakening of the rand against major currencies over the past two years has been a big driver of returns for South African investors invested offshore, and may even have masked poor investment allocation. Now that the rand is close to fair value, the performance of the underlying offshore assets will be far more […]
Marriott, the Income Specialists, looks at the current state of the investment environment and offers suggestions on investment options. Over the past 5 years retired investors have weathered a storm of negative real cash interest rates and historically low bond and property yields globally. Fortunately, this environment is starting to return to “normal” with interest […]
By David Warneke, Director: Tax, BDO South Africa This article, which examines the taxation treatment that results from the sale of share scheme shares, concludes that it is advisable to hold any shares for a period of at least three years before disposing of them – including shares acquired in terms of an employer’s share […]
PART II The Davis Tax Committee (DTC) has made a bold opening move with the release of its first interim report: The Small and medium Enterprises (SME): Taxation Considerations, Interim report July 2014. According to Erich Bell, Tax Technical at the South African Institute of Tax Professionals (SAIT), the DTC report contains a number of […]
It’s no secret that women admirably spend their lives juggling the demands of work and home, only to find that, when they reach retirement, their financial status isn’t what they had hoped it would be. It has been statistically proven internationally – The Women’s Institute for a Secure Retirement reports that women typically work 12 […]
FATCA Q & A with Dalila Ver Elst, Senior Compliance Officer, Maitland 1. Q: Does FATCA affect financial institutions even if they have no United States investors? A: Yes, any non-US financial institution must register under FATCA regardless of whether or not it has US investors. The FATCA agreements and regulations apply to all financial […]
Follow us on Twitter
- RDR will allow for advice fees to be tailored for each client and the services they receive 5 days ago
- Implementation date of RDR TCF Twin Peaks - 2016 - with transition periods Caroline da Silva FIA roadshow 5 days ago
- RDR has taken long - but allowed us to learn from others' mistakes and learn where we are unique. Caroline da Silva, FIA roadshow 5 days ago
- In investment business RDR proposing no commission, possible exemption in entry level market where fees would negate accessibility 5 days ago
- RDR - Advice fees proposed that these can be collected by the insurer Caroline da Silva, FIA roadshow 5 days ago
Subscribe to our Newsletter
Newsletter 28 August 2014: A sound retirement
Awaiting Spring! Today we feature an article that looks at the various strategies commonly used […]
- Regulatory Exams: Flavour of the Month June 29, 2010
- Insolvency July 6, 2010
- Actuaries a wanted resource post the global crisis June 20, 2010
- ASISA announces full Board of Directors June 20, 2010
- Blue Ink Wins Best Fund of Hedge Fund Award June 20, 2010
- Newsletter 28 August 2014: A sound retirement August 29, 2014
- A great number of unemployment numbers to look at – here and in the US August 26, 2014
- Why women should have greater control of their finances August 26, 2014
- Check your medical to-do list this Women’s month August 26, 2014
- Five tips for investing offshore August 26, 2014
- top seo company: Can you tell us more about this? I'd like to find...
- Sanet: Is there still exam dates and venues to write the ...
- What is Insolvency?: I do not even know the way I ended up here, but I ...
- Vanessa Reinecke: I wrote the exam on 23 May 2011. There were only ...
- Gerard: I have written the exams during Jan 2011.4% pass r...