Understanding investments might seem daunting; however, with the correct knowledge base and patience you can position yourself amongst the elite.
The 2020/21 financial year was not the most memorial year for investors mainly due to the effect of the pandemic and the associated restrictions on commerce. As such, (potential) investors have become weary of the performance of the money in several asset classes (e.g., equities and mutual funds). Market volatility is a common occurrence and can have several consequences for present and future investments, both positive and negative. However, by understanding the purpose of your investment, the structure of your investment and the time horizon; you’re able to enjoy the good times and persevere through the worse.
In an era of social media and instant gratification it is easy to get lost in consumerism and postpone thoughts pertaining to retirement. More so, saving is not enough – rather saving in the correct savings vehicles (depending on your personalised financial goals) should be of paramount importance. Factors such as the interest rate and inflation are important considerations when deciding on how, when and where to invest.
With inflation and interest rates at 4.4% and 3.5% respectively, investments structured at exposing you to adequate degrees of risk with the necessary amount of diversification will enable you to receive the best possible returns, but also provide the protection against unforeseen fluctuation.
Interest bearing investments have the added benefit that you will receive dividends (a percentage of the company’s earnings) which you may then decide to reinvest, thus increasing the value of your investment. These returns do vary between institutions as well as between specific investment portfolios that is why it is important to consult with the relevant professionals so as to make the best informed decision.
So whether you’re looking to invest for the short term towards your children’s education or pending retirement several years or decades from now; capitalising on what’s on offer within the investment sector should be something each individual ponders on seriously.
Below are some of the best investment companies in South Africa to assist you in making your first step towards a better financial future.
- Allan Gray:
Established in 1973, this is one of the largest well-known investment companies as they offer a wide range of investment plans and products including retirement annuities, unit trusts and tax-free savings accounts. More so, you could tap into the global market via their offer offshore investment services
A joint venture between Standard Bank of South Africa and Liberty Life, Stanlib has been operational since 2020. Managing more than R 600 billion worth of assets, Stanlib has managed to identify alternative ways to achieve investment growth and capital preservation. They also provide their clients with a range offer investment options including that of offshore.
- Prudential Investment Managers:
With an offering of a wide range of unit trusts that include equity funds, balanced funds, property funds, income funds, tax-free funds, and offshore investments; it is no surprise that Prudential is one of the largest investment companies in South Africa with assets under management in excess of R 250 billion. Prudential South Africa is part of the wider M&G plc group, one of Europe’s largest active asset managers with the vision of helping clients achieve their financial goals by successfully managing their investments by using a long-established prudent valuation-based approach.
- Coronation Fund Managers:
With almost 20 years in the investment industry, Coronation is best suited for individuals seeking to invest towards retirement. As of December 2020, R594.7 billion in client assets was reported to be under their management. In addition to retirement savings vehicles (i.e., pension and provident funds), Coronation also provides options with respect to medical schemes, unit trusts, banks, insurers, and other fund managers. An investor may also decide to enter into international retirement funds, endowments, and family offices. This highly adaptable organisation is a level 2 BBBEE certified and collaborates with several NGOs as part of it corporate social investment initiatives.
Founded in 1974 in Johannesburg, Investec has branches in countries across five continents. Despite its humble beginnings it now provides services such as: private banking; capital markets; investment banking; corporate, business and institutional banking; property activities and wealth management. For these reasons it is amongst the best companies that can assist you in growing your wealth with optimal returns on your capital.
- iTransact Fund Managers (IFM)
Intrasact Fund Managers offer a collective of investment schemes with various investment objectives ranging from: value investing to ultra-conservative. The funds on offer includes investments to both retail and institutional investors.
Depending on your investment objectives, ABSA has a proven track record with their plethora of investment products in conjunction to their expertise and capabilities, they will help you grow your money, generate an income and also protect your capital. Investments on offer includes options like unit trusts, tax-free investments, retirement annuity fund, investment account, offshore investments, and linked endowment policies.
- Old Mutual
Founded in Cape Town since 1845, Old Mutual is one of the oldest and leading investment managers in Africa, offering a wide range of comprehensive investment capabilities. With branches spanning across Africa and holdings in China, Old Mutual was reported to have more than R 1 trillion in assets under management as of 2018.
- Foord Balanced Fund
With an appetite for exceling at retirement investments, the main goal at Foord is to grow retirement savings by meaningful, inflation-beating returns over the long term. They boast a multi-decade track record of successful investing evidences its capacity to consistently deliver superior investment returns for a range of investment strategies.
- 1Fairtree Capital
Since its inception in 2003, Fairtree has achieved great things with the latest being the Best SA Equity General Fund on a risk-adjusted basis. This organisation identifies the need for individuality as it offers tailored fund in addition to single funds. More so, Fairtree Capital launched its own foundation that supports social inspiring initiatives.
- Allan Gray:
Identifying the correct investment and investor is important in terms of achieving your financial goals. Patience, trust and resilience are required in order to benefit from what the investment market has to offer. Remember to take the time learn, but also that investing can be extremely exciting and lucrative. So, take up the challenge of securing the finances of both you and your family.