In this months update, Theo and Warren provide an overview of what’s happening in South Africa and how to invest taking these factors into account.
A note from one of our planners:
Most governments have, over the years, developed an EWS (early warning system) in an attempt to limit casualties in times of war and other disasters. These systems are by no means fool-proof.
Unfortunately, as much as we try to use models, algorithms and theories to warn and mitigate against financial harm there is no fool-proof financial EWS. Many South Africans are feeling vulnerable at the moment and are assessing their investments and personal financial situation against the current backdrop of the South African economy, politics and the fluctuations in the Rand/US Dollar exchange rate. Some are finding themselves in a state of financial fear and emotional turmoil but others, albeit somewhat cautious, are much more financially and emotionally comfortable.
What could be the reason(s) for the relative calmness of the latter group?
I would suggest that the answer to that question can be found in the fact that the 2nd group, will provide a resounding YES to the following questions;
- Do you have a cash fund available to you to provide funds that may be needed should you experience retrenchment, emergency or other financial calamity?
- Are your investments diversified between the different asset classes such as cash, equity and property taking into account your personal financial timelines?
- Do you have local/foreign investments proportionately diversified to meet the demands of your financial plans
- Have you tested the structure of your investment portfolio against your tolerance for financial risk in the light of your financial planning?
The good news is that
if you have answered “No” to any of the above questions, an authorized
financial planner is able to assist you to resolve your situation. If you
don’t have a financial planner send an email to [email protected] and
we will be more than happy to assist you.
– Thayn Niemand CFP®