The global spread of the Coronavirus is a major concern resulting in stock markets plummeting. Further downside is likely as fear grips the world until a ‘cure’ or vaccination is found. I have worked through three previous stock market crashes – 1987, 1998 and 2008. The experience was both sobering and frightening as all three crashes had one thing in common, fear. With the stock market down 10% last week, is the Coronavirus scaring the stock market into another crash (down 30% to 50%)? We look at the facts so far, what to expect and how to manage your investments through this time of significant uncertainty.

For retirement, our investments must achieve an after-tax return above inflation. This is easier said than done within the constraints of prevailing volatile markets. Safeguarding your money in the bank while earning interest will make you poorer over time as inflation erodes the value of your investments. We assess how much you need to earn to beat inflation after-tax and suggest a low-risk investment strategy to achieve this.

In the current environment, it may feel right to be investing all your money offshore. This view may also be supported by the data that global equities returned 17% p.a. over the last decade. However, currently, global equities are generally risky as they are expensive, and therefore, one needs to be careful with an offshore investment strategy.

It is important for investors to take the time to assess their retirement investments at least once a year and check that they are on track to meet their goals.
Here are some important questions to assess your current retirement annuity, preservation fund or living annuity investments.

At the start of 2019 we predicted better investment returns, albeit a bumpy ride, and that is what we got. We expect more of the same for 2020. But don’t be too perturbed. If you have the right investment strategy you should beat inflation, evidenced by our low-risk, highly ranked, Prosperity Worldwide Fund that returned 16.4% in 2019. Please read our 2020 investment market outlook.

As South Africans come to the end of a frustrating year, it is a good time to reflect on the year that was and set our sights on how we are going to tackle 2020. This week, we touch on Investonline’s successful year, review how our 2019 predictions panned out, summarise our market views for 2020, highlight our most popular articles of the year and feature our leading financial planning tools and processes.

As we start rounding off a challenging year, now is a good time to reflect on some financial mistakes we should avoid going into 2020.

In my 30 years in the investment market, I can’t remember the mood in the country being this negative – and that is despite an exceptional Rugby World Cup win! Other than Ramaphosa being removed as President, I can’t think how things could get any worse. I believe, economically, the country is near its low point and that this is being reflected in investment markets. Allan Gray has written an article outlining 10 critical areas that need ‘doing’ to get the country to start growing, which we have summarised for you.

The Springbok strategy this past weekend against Wales was not pretty, but it worked. Just as the Boks have a plan that plays to their strengths and produces a win, so too should each person have their own unique plan to meet their financial goals. The plan does not need to be dynamic or creative, but it must be tailored to your needs. It starts with engaging with a qualified independent financial advisor, as recommended by Allan Gray. Please read Allan Gray’s views on the role of an advisor in your investment success.

As our hope for a material recovery in the economy fades, let’s not confuse this with good investment opportunities. We need to be realistic about what the environment presents and position ourselves according to our own personal risk profiles. Please read our fourth quarter economic and market outlook report where we highlight the difference between economic activity and investment opportunity.