Developed country stock markets were notching up steady gains until the last day of the month when the US Federal Reserve upset markets by putting paid to market expectations that a 25-basis point rate cut may be the beginning of an aggressive rate-cutting cycle. Developed market stock markets still managed to gain ground for the month but emerging markets lost ground.
Derivatives are often associated with complexity, risk and leverage but in reality they allow fund managers to put in place insurance that protects investments against downside risk. Used for hedging, they are particularly useful in times of great volatility and uncertainty, like now.
Financial markets are in choppy waters, with conditions profoundly changing direction overnight on a Trump tweet or expectations for the world economy. Sanlam Select navigates these challenging conditions by following a dynamic approach that gives advisers access to next generation asset managers that offer additional sources of return.
South Africa’s government finances are cause for grave concern. The only plausible way forward is to tackle the problem now, before it becomes insurmountable and government finds itself in a debt trap.
At the sixth annual i3 Summit Satrix chief investment officer, Kingsley Williams, likened the structuring of a successful investment portfolio to choosing the right systems to harvest and store water. “We build portfolios to achieve specific objectives; if we equate water with market returns then we can see how the analogy plays out”. The trick is to have different sources of water, or a sufficiently diverse portfolio to generate excess return through both good and bad times.