Simon Shares

• Local GDP came in better then expected and importantly positive, so no technical recession. Manufacturing and mining were the strong sectors but we need a lot more very strong quarters to get out of the bad spot we find ourselves in and a down grade is still very much on the cards in December.
• Discovery (JSE code: DSY) has so many moving parts but for me the key is Vitality is now in 14 markets around the world. I remain a happy shareholder albeit they've done very little over the last year or so.
• We have a lot of shopping malls in South Africa, b some reports more per capita than any other country. Hyprop (JSE code: HYP) is by far the best of the bunch with regard local malls as they own high traffic top end malls.
• Mr Price (JSE code: MRP) seems to have lost the mantle. They have now had three reporting seasons over the last year and all disappointed. Is it just bad buying and the weather? I suspect they're seriously struggling under the weight on new competition from the likes of H&M and Cotton On. This is a biggie and if I was a shareholder I would be looking to exit.
• Capitec (JSE code: CPI) trading update sees HEPS 17%-20% higher. Wth a historic PE of almost 22x a little light but well ahead of consensus that was looking for single digit growth.
• Does volatility give you indigestion? Kristia reviews the CoreShares LowVoltrax ETF with expert commentary from Warren Ingram.
• Tonight, going back to basics with wealth creation 101 at the JSE.
• The Fat Wallet Show did the follow up about buying a house vs. renting.

Stock Exchange News Service (SENS)

Some listed companies seem to use it as marketing (witness the Sibanye proudly announcing their inclusion into the Top40 later this month and CarTrack announcing 550k subscribers) while other publish the bare bones (Comiar and Master Drilling just giving numbers in previous years). Others like Steinhoff seem to have moved onto Europe forgotten about us and just push links through SENS.

I would also like to see a standard applied by the JSE. For example all results have to have the top four points (HEPS, Dividend, revenue & debt) right up front so you can't hide.

JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.

Questions, questions, questions

Simon Shares

• Metrofile (JSE code: MFL) results saw HEPS +4.6% (very modest) and the full year dividend 42.9% putting it on a dividend yield of some 6%. Wowness and why I own the stock, for the dividend.
• PPC nil paid letters (NPLs) started trading yesterday as PPCN. People are asking me what to do with them and I am sticking to my story. Shorter term after they convert we may get a bounce, longer term PPC has real risks and I would not want to be a holder. So short answer is sell.
• Bidvest (JSE code: BVT) results were weak with single digit HEPS growth of 2.5% while Bidcorp (JSE code: BID) had great HEPS growth. We know the story and why they split, one local one offshore.
• Nigerian GDP stays negative and country is now in a technical recession. More tough times for local companies operating in that market.
• I am being asked if I am selling the gold stocks in the momentum portfolio? The answer is no, it is a rules based system and we follow the rules.
• GIVRES has done an amazing 99.5% in the last year, Kristia reviews the ETF and get expert commentary from Petri Redelinghuys.
• Next Thursday we have a JSE Power Hour, online or at the JSE in Sandton and we're going back to basics - always a good place to revisit. The topic is wealth creation 101 and is presented by Simon Brown.
• The second part of the Trading Master Class with IG is online, dealing with an index trading system.

We Get Mail

• George
  • I am 25 years old. I own DBX trackers for EUR, US and JAPAN as well as Ashburton Midcap (thanx to your lazy system). I now have an additional R10k to invest in my TFSA. I know what you would do: DBXWorld and a Top40 ETF. But my thinking is that I already have enough exposure to the world and instead of doing an SA top 40, maybe I should invest in an ETF that generates me dividends/interest for the long haul. This seems like a smart idea to a youngster like me. But being a youngster, my ideas are often not the smartest. I am currently thinking of investing in the Coreshares Preftrax ETF and/or the Proptrax Ten. Is this idea smart? If you were me, what would you do with the 10k?
• Ernst
  • South Africa's economy is not looking great at the moment, Gordhan, the rand, junk status. I would like to know if one should invest now in Top 40 ETFs or wait it out till these things happen and everything might be cheap (the value of shares ). Not sure how to use my X amount of money in this time.
• Jing
  • I have had a look at your portfolio and frequently watch your shows. A lot of it seems to be geared towards having offshore exposure and selecting shares with offshore operations. I am currently contemplating investing in developing/emerging economies namely India and China as I feel there is a lot of upside given the size of their economies and high growth rates relative to the rest of the world. I was wondering whether you had any insights on whether this would be a good move at present. Furthermore, are there any funds in South Africa that could give me such exposure to the Indian or Chinese stock exchanges? I know that there are a few shares on the JSE that have interests in China such as Naspers in Tencent holdings, but I am looking at having a broader and more direct exposure to these markets.
• John
  • Hi again Simon, the Stop Losses I have difficulty with are not in Trading but in Investing which are not the same as far as I'm concerned. Trading is far more hands-on. Have lost heavily with CCO & BAT post Brexit & realise I must be far more ruthless but am still unsure as to where I should have placed my SL's.
• Marcia
  • I am worried about the Rand and it weakening a whole lot suddenly. How can I protect against this?
• Sylvester
  • I don't have time to do trading but I want to invest, do I buy and hold ETFs or I look for someone to trade for me.

JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.

Role of a Stock Broker in your investment journey

Simon Shares

• More finance minister concerns and more rand weakness. The bigger picture is you have to have a bigger picture investment view otherwise events like this will hurt.
• In the last of this three part series if you had R300, which ETF would you buy? We ask Warren Ingram and Craig Gradidge for their view.
• Trading Master Class, an index trading system is online and follow up in on Monday at 1pm.
• Tonight in Durban we have a JSE Power Hour - 9.97562 Possible Pitfalls in Investment Planning
• Our home ownership is the new broke podcast is still generating lots of buzz. Kristia has been on leave so we reward a bunch of Fat Wallet Shows, we will revisit the topic Monday week (5 September).

Role of a Stock Broker in your investment journey

• Simon Brown - Founder of JustOneLap.com
• Ridwaan Moolla - ABSA, Head of Digital Enablement in Wealth and Investments
• Charles Savage – Purple Group, Group CEO
• Kevin Algeo – IG, Head of IG
• Greg Kangleas - Vunani Private Clients, Head of Copy Trade and Portfolio Manager
• Grant Meintjes - PSG Wealth, Head of PSG Securities

JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.

Where to for the Rand?

Simon Shares

• The Dow Jones, S&P500 and Nasdaq all closed at all time highs for the first time since December 1999.
• Dog stocks, don't mix price and fundamentals.
• I been buying PTXTEN after exiting my STXDIV and not being blown away by DIVTRX.
• If you had R300, which ETF would you buy? We ask Nerina Visser & Keith McLachlan for their view.
• Trading Master Class, an index trading system is online.

Garth MacKenzie TradersCorner.co.za

Where too for the rand? We've seen it stronger this year after a blow out late last year and into January. Garth offers a technical view and below is the long term monthly chart of USD/ZAR.

We Get Mail

• Fouche
  • Would there be any merit in the argument that Japan is 20 years ahead of "us" (USA Europe world markets that are applying QE) and we could be looking at similar years of sideways movement?
• Aaron
  • I have an aunt who wants to start saving R10k p/m for the next 12 months. What can you advise as the most suitable investment option. She asked for my advise but am not sure what to suggest to her as I think 1 year is a short period.
• Ryno
  • Thanks for the in-depth response to my question. With regulation stopping the building of a Berkshire lookalike wont it be a viable option for a DIY investor to buy say 5 or 6 REITs and use the income out of that as money to buy listed companies?

JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.

Simon Shares

• US mattresses with Steinhoff (JSE code: SNH)? Paying more than double the last traded price?
• MTN looks all ugly. Forget the fine, forget over a billion Rands in associated costs. Nigerian and South African markets look weak and I still say they need to transition into being a data utility. That said there's a nice trade from around R122 - R140.
• SABMiller (JSE code: SAB) leaving the JSE on 11 October (most likely) after listing on the JSE in 1897 (just two years after being founded and a decade after the JSE was founded). SAB has been one of the key drivers of the Indi25 index over the last decade (SAB +472%, All Share +154%). They're going to leave a gapping hole.
• If you had R300, which ETF would you buy? We ask the Just One Lap team for their picks.
• The Fat Wallet Show goes where few are brave enough to trend. Renting vs. buying, what does the maths say?

Keith McLachlan from Alpha Wealth

Finding a local Berkshire Hathaway? Simon answered a listener questions suggesting that maybe Conduit Capital (JSE code: CND) was an option. The trick however is the regulatory environment and Keith McLachlan helps us understand what those Solvency Assessment and Management (SAM) regulations are and how difficult it makes for a company to model themselves on Berkshire Hathaway.

We Get Mail

• Caroline
  • Richemont (JSE code: CFR) has been falling steadily for nearly a year and is down 26.59%. Is it now regarded as a “Dog”???? Or because it is in your Death Do Us Part portfolio has it become a “Puppy”? Question – have you sold or not? My problem is Astoria (JSE code: ARA). I bought for long, long, term and that has fallen about the same. Do I bale and lose a large dollop of my portfolio which I am no longer in a position to recoup, or let it turn around with the Rand exchange rate. Problem is that might not happen in my lifetime!!! Decisions …. decisions
• Tax feedback
  • Just a point on not being able to offset trading losses against other income, believe you can as long as SARS didn't ring fence the loss and your chances are better if you are not at marginal tax rate,activity not deemed to be a hobby and not more than 3 losses out of last 5 tax years.
  • I can feel for Johan. I used the "Other income" to declare 'trading income' from various sources. I keep these income's to the bare minimum. HOWEVER.... No easy place to claim expenses as a separate entry. Unless You open the can of worms called "Business" income.
• Jacques
  • Any ideas on how to benefit from current strong rand i.e. which ETFs are good options to take some cash offshore?

JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.

Short zombie stocks

Simon Shares

• Did you sell your dogs?
• Keith McLachlan commented on Conduit Capital and it's not all wannabe Berkshire Hathaway.
• Second session in the first Trading Master Class with IG was on Tuesday. We're looking at a CFD trading plan and this session went live on the IG platform looking for stocks and three buys popped up; Barclays Africa Group (JSE code: BGA), PSG & Woolies (JSE code: WHL).
• The Fat Wallet Show goes back to bonds because last time we started complicated which is not what Fat Wallets are about.
• Small is the new big says Trader Petri and we agree 100%.

Short the zombie stocks

We Get Mail

• Johan
  • I would appreciate it very much if you could tell me where one would declare CFD trading outcomes on the SARS form. Have just spent 45 minutes on the phone to SARS help without making any progress.
• Sarah
  • What about Bitcoin as an investment?
  • Pipcoin is a scam.

123

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JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.

Sell the dogs (sorry dogs)

Simon Shares

• Ellies (JSE code: ELI) results were as ugly as expected and the company is being kept alive by their bankers at Standard Bank. Megatron is worthless after buying it for R180million in 2008 and spending some half billion keeping it afloat. A few weeks ago in FinWeek I said sell ELI at around 60c and I would not be a buyer now.
• Kumba (JSE code: KIO) results were not bad. They have got their cost down to $34/tonne from closer to $55 previously. It does mean less production to get the lower costs and the market is still in massive over supply but they at least now positioned to (likely) survive.
• SABMiller (JSE code: SAB) got an extra pound with the offering being revised to GBP45 but some minority shareholders are still not happy as the pound has weakened. One can hardly blame SAB or AB Inbev for that but the minority shareholders need 25% to block the deal and that's very unlikely.
• Kristia looks at ETF costs in her blog this week.
• The Fat Wallet Show takes Magnus Heystek to task for suggesting all ETFs are evil and have been mis-sold over the years.

Anchoring - sell the dog

Simon talks about getting rid of those zombie stock in your portfolio; when, why and how. Most importantly they are causing pain and the price you paid for them does not matter.

We Get Mail

• Ryno
  • Why hasn't anybody (in SA) tried to replicate the Berkshire model of buying insurance companies and using money of premiums to make investments in big companies ?
• Lindiwe
  • What happens if Deutsche Bank goes under and I hold their ETFs?
• Anon
  • Any hope for Taste (JSE code: TAS)?

JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.

Private equity coming to the JSE

Simon Shares

• So Trump is real and is now officially the Republican nomination for the US presidency. The point is he can win it and then the question is what will markets do? Likely pretty much like what happened after Brexit, initial panic and then they will move on.
• The first IG Master Class kicked off on Tuesday with a complete CFD share trading system. Nice simple and practical with a follow up webcast on 2 August at 1pm.
• I have added a live link to prices I am prepared to pay for my 'till death do us part portfolio', the link is here.
• Thursday evening we're at the JSE for a Power Hour, Investors are normal, not rational.
• Kristia reviews another Top40 ETF, the Ashburton Top40 (JSE code: ASHT40).

Stuart MacKenzie (CEO Ethos Pvt Equity) and Peter Hayward-Butt (CEO Ethos Capital)

Ethos Capital (JSE code: EPE) will be listing on the JSE in August via a private placement. Ethos is a Private Equity investment vehicle that offers a different investment asset class for patient investors.

We Get Mail

• Michele
  • When trading(lazy) indi, resi, etc, what charting do you use for your ema's and entries?
• Melissa
  • Why is it that you can buy Satrix ETFs such as STX40, STXDIV & STXRAFI from your stock broker in their online trading platform... And from Satrix directly? What is the difference between where you buy into these? Are you getting less if you don't buy directly from Satrix?
• Thabang
  • I have a million and need another million. How do I double it?

Simon Shares

• A lot of people worried abut DBXWD post Brexit, but the issue is it is global so the UK makes up only about 8% while EU is about 13%. I hold the ETF and continue to buy every month.
• The Just One La team has a monster busy week next week. Join us at;
  • Trading Master Class: Designing a trading system from scratch (Tue 19th)
  • Classic FM making wealth simple  (Wed 20th)
  • JSE Power Hour: Investors are normal, not rational  (Thu 21st)
• Kristia asks which ETF?

Drikus Combrink - Capicraft Investment Partners

Locally earnings season has come to an end and markets are at or near all time highs. Are these valuations justified by the earnings we've seen? Good, bad, ugly and any stand outs. Drikus touches on some concerns (SABMiller & Richemont) and suggests really focusing on the core numbers rather than top line numbers that could be skewed by currency moves, mergers or new stores. His major concern remains QE and how that unravels.

We Get Mail

• Ronnie
  • What is the recommended amount to start with investing on any share?
• Pierre
  • Donna wants short term savings and is using bank account. Why not the pref shares ETF - PREFTXF?

JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.

Stock Broker vs. FSP

Simon Shares

• So Brexit is now a thing, or is it? Mostly it is confusion.
• Money Expo this Friday and Saturday.
• My 'till death do us part' portfolio webcast in next week Thursday at 8pm.
• Satrix Indi has been a star ETF with the best returns over 10 years at over 400%.
• Lazy System is long Indi25 and MidCap.

Charles Savage, CEO Purple Capital / Easy Equities

What's the difference between a traditional stock broker and a Financial Services provider (FSP)? Is a FSP risky and do I really own the shares? These are popular concerns so we got Charles on the line to address the issues. We also briefly touched on their new baskets they launched last month.

JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.

Simon's till death us part portfolio

Simon Shares

In last weeks show I covered Porter's Five Forces for selecting awesome shares worthy of investing in. This week I delve into my personal 'til death do us part' portfolio explaining why I hold each share. In two weeks (13 July, book here) we'll have a webcast where you can interrogate my selection and also propose shares of your own for inclusion into a 'til death do us part' portfolio.

At the time of recording my portfolio is as below (Find my consistently updated portfolio here)

• BHPBilliton (JSE code: BIL)
• Capitec (JSE code: CPI)
• Citylodge (JSE code: CLH)
• Discovery (JSE code: DSY)
• Famous Brands (JSE code: FBR)
• Metrofile (JSE code: MFL)
• Richemont (JSE code: CFR)
• Sasol (JSE code: SOL)
• Shoprite (JSE code: SHP)
• Woolies (JSE code: WHL)

===

JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.

Finding awesome stocks to invest in

Simon Shares

I am traveling and then on leave, so this week I look at Porter's Five Forces and in next weeks podcast I follow this up by running my 'death do us part' portfolio of stocks through the process. Then two weeks after that (13 July 8pm) we'll do a live webcast whereby you can ask questions about my portfolio and any stocks you may consider worthy of a 'death do us part' portfolio (my portfolio is always published live here). Book for the webcast here.

Porter's Five Forces

• Competitive rivalry within an industry
• Threat of substitute products
• Threat of new entrants
• Bargaining power of customers
• Bargaining power of suppliers

I add;

• Buy winning stocks in winning sectors
• Legislative risk

You'll find a review of Porter's Five Forces here and I also include it in the Boot Camp video on Fundamentals and Technicals in which I include examples from local stocks.

JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.

Hedge funds for everybody

Simon Shares

• MTN have concluded the Nigerian fine at around a third of the initially proposed fine. A good deal for the company but they should never have found themsleves in the position in the first place an I still do not like management and am not a buyer.
• Pick n Pay (JSE code: PIK) are finally getting rid of their 35-year pyramid structure that key control of the company in the Ackerman hands even though they only held c26% of the shares. But they are retaining control via special unlisted B shares, so nothing changes and the company remains under the control of a family who frankly have conceded the title of retail to Shoprite (JSE code: SHP).
• Brexit fears are running wild, ignore it. It's just short term noise. Big picture it matters not one way or the other, it just hysteria right now that will reach deafening levels by the time they vote next Thursday.

Jean Pierre Verster portfolio manager Fairtree Capital

The hedge fund industry in South Africa is leading the global trend and changing to make itself open to private investors with regulation for the funds themselves. Jean Pierre explains what the attraction of a hedge fund is and what the new regulations are all about. He also warn that like any other fund some may blow up.

We Get Mail

• Robert
  • When I buy ETFs, how do i find out whether it pays out quarterly dividends or re invests them?
• Jonathan
  • Shares not in your name, rather on Easyequities books? Thoughts?

Simon Shares

• New logo for JSE Direct to bring it inline with the new Just One Lap branding.
• S&P is negative but not junk, Fitch says we stable, GDP says we half way to a recession.
• GIVISA, the cheapest ETF on the JSE. But is it any good? Kristia goes on a nerdy bender digging into the details.
• Keith McLachlan on building a small cap portfolio.
• The Just One Lap team is starting to do more Periscope videos; follow us all at;
  • DeeOnMoneyZA
  • TraderPetri
  • KristiaVH
  • SimonPB

Zack Bezuidenhout S&P Dow Jones Indices

We chat indices, costs, new developments and smart beta. Zack also has a great analogy about the financial services fee structure and the medical industry that really highlights the wrongs in the financial services industry.

We Get Mail

• Lauren
  • What about the Swix index for investing?
• Rudolph
  • A question, are you still happy with your decision to sell all your BATS shares, after a 40% return the past year?
• Philip
  • Regarding the debate of investing in the US or worldwide, why not invest in these 2 ETFs – namely, IXUS and ITO? I do not think you are going to find ETFs with lower fees, 0.03 and 0.14. The IXUS seeks to track the investment results of an index composed of large-, mid- and small- cap non-U.S. equities. The ITOT seeks to track the investment results of a broad-based index composed of U.S. equities.

Can DIY investing beat the market?

Simon Shares

• PPC in real trouble. Management have let the company down by not spending up capex locally, not hedging their USD debt and now they need a massive rights issue. Will they survive?
• Are local markets pricing in a downgrade? Nobody knows either what Standard & Poors will say or what the market is or is not pricing in.
  We have a new podcast going live every week, The Fat Wallet Show. In it Just One Lap CEO Kristia van Heerden, picks a topic and asks questions until she gets an answer. She kicked off with structured products.
• Momentum portfolio update for the quarter ending May 2016 is here, life time returns below.

We Get Mail

• Daniel
  • Now if research shows that the percentage of fund managers that outperform the index over a 1, 3, 5+ year period get smaller and smaller then, what chance do we as retail investors have of: A) outperforming a fund manager (with CFA's, CA's, research teams) when stock picking; and B) outperforming the index?
• Esther
  • Please give details on tax and the trader.
• Kenny
  • I have a discretionary share portfolio in which I occasionally sell a share after keeping it for less than 3 years. I never withdraw money out of my account, but will keep it in cash and wait for a buying opportunity. Will I be held liable for income tax or does income tax only apply when an investor withdraw money out of his share account?
• Higgo (via twitter)
  • Would you rather sell Discovery (JSE code: DSY) and buy British American Tobacco (JSE code: BTI) or Investec (JSE code: INP/INL)? 

JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.

A simple diverse ETF portfolio

Simon Shares

• Balwin (JSE code: BWN) knocked their results out of the park, but my bigger picture concerns remain.
• Standard & Poors down grade or not is next Friday. I did a Twitter poll that came in split by 1 vote. So nobody knows.

• Complexity of costs. Come industry make it simple.
• Mining: Returning to the mean? Peter Major did an excellent JSE Power Hour for us, the video is here.
• On the ETF blog this week we look at the Pref shares ETF (JSE code: PREFTX).
• 2 June at 5.30pm,Keith McLachlan on building a small and mid cap portfolio the right way. Book here.

Nerina Visser, director at ETFsa.co.za

Which ETF if you buying for;

• R300 / month (CTOP50)
• R1000 / month (CTOP50, DBXWD & ASHINF)
• Large lump sum into a TFSA (CTOP50, DBXWD, ASHINF & PTXTEN)

We also chatted about costs, are we missing any ETFs as an industry and how to respond to the potential downgrade from Standard and Poors. 

JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.

Doing risk right

A very long show this week (over an hour), but totally worth every second of listening.

Last week I reflected on the Sanlam i3 Summit I attend and his week I speak with Roland Rousseau (Head of Barclays Risk Strategy Group) on his presentation at the conference.

Roland is looking at this whole idea of asset or fund manager being outdated and suggesting we rather need risk managers. He has great insights and ideas and this wide ranging conversation on risk has got me thinking a lot more about a lot of things. Real learning, I love it.

Simon

JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.

How do we get smarter?

Simon Shares

• Calgro M3 (JSE code: CGR) results were great. We're seeing operational leverage coming through and a lot of projects seem to have only added a modest amount in this year with more coming in the new financial year and the memorial parks look interesting. They did have some issues with Namibia, having to relaunch the retirement development and others. Back in December / January I exited some of my position but am happy to hold the balance.
• Pipcoin = pyramid scam
• What's happened to the PIIGS?
• So Moody's was all nice to us, sure but are we really avoiding the ultimate downgrade to junk? Standard & Poors still the one to watch with June their next update and likely the first to make us junk.
• On the ETF blog this week we look at the Momentum ETF (JSE code: NFEMOM) as well as find out about total return which involves dividends being automatically reinvested into the ETF.
• We're doing a webcast of the lazy trading system on the 12th at 8pm and an IG Boot Camp on Tuesday at 6pm. Book here.

Sanlam i3 2016 Summit

I attended this event last week and have a number of thought from the speakers, in particular Dr Amlan Roy who spoke on demographics (here's a short video interview with him). 

My three key learnings;

• Differences more important than similarities (Eusebius McKaiser)
• Demographics most important thing we ignore (Dr Amlan Roy)
• Most of what we think is skill is actually well spent (Roland Rousseau)

We Get Mail

• Samuel
  • Is there a way to position my portfolio to minimize risk when a downgrade of the country`s credit rating is on its way? I believe that the downgrade will happen in this year. Is there a way to gain on this?
• Everybody
  • Where do I find an offshore broker?

JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.

Master class in investing

Simon Shares

• This week we look at a bond ETF, ASHINF.
• We're doing a webcast of the lazy trading system on the 12th at 8pm.

Hlelo Giyose – First Avenue Investment Management

Hlelo talks stocks but the conversation goes into much more than just some of his current preferred stocks. He delves into what makes great companies, how to spot them and when to buy them. A master class in investing.

JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.

Where to invest offshore?

Simon Shares

• Pick n Pay (JSE code: PIK) results show the turn around is very much working albeit the stock remains very expensive. But the margins are still way to slim at 2% and less than half that of Shoprite (JSE code: SHP). This has to be the focus going forward if they have any hope of justifying the stretched valuation.
• MTN is getting money out of Iran, reportedly USD1billion and this certainly helps with the Nigerian fine, but once again this comes from third party sources not from the company via SENS.
• Steinhoff (JSE code: SNH) said it won’t raise its offer for French retailer Darty and this is a good thing because in a bidding war the only winner is the seller.
• Berkshire Hathaway is webcasting their AGM this weekend, this Saturday 30th April 2016 at 4pm. you can view it here.
• Kristia van Heerden looks back at a year of erratic ETF buying in our weekly ETF blog.
• We're doing a webcast of the lazy trading system on the 12th at 8pm.

Wehmeyer Ferreira from DB X-Trackers

Where to invest offshore? US, EU, UK or Japan? What of China or maybe just the world?

We've recently covered two of the more popular ETFs from Deutsche Bank; DBXWD and DBXUS.

We Get Mail

• Samuel
  • Should a home loan be considered as debt?
• Tshepo
  • What is best index to use for a benchmark?

JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.

An investment check list

Simon Shares

• Everybody is freaking out on the Capital&Counties (JSE code: CCO) sell off, some 50% off the highs of January. Really driven by three things; it had been flying, stronger ZAR against Sterling and concerns about Brexit. Long term not an issue, so if you love the stock nows your chance to get more cheaper.
• Kristia van Heerden (Just One Lap CEO) tweeted some thoughts from last weeks podcast where I spoke about expectations. Her comment was that managing expectations doesn't start with investing. It's also about debt, hating on your job. These need fixing long before investing and certainly no investment will make your job better or the debt suddenly disappear.

If you expect your investments to save you from your shitty job or debt or pay for things you can't afford, you're in for disappointment.

— Kristia van Heerden (@kristiavh) April 18, 2016

• Our ETF this week is DBXUS and it has staggering returns of 223% over five years.
• New videos galore;
  • Managing volatility with Gary Booysen
  • IG Boot Camp: Trading psychology
• Added a bunch of new events, find them here.

Gary Booysen Portfolio Manager Rand Swiss

Gary did a great presentation for the JSE Power Hour last week (find it here). In it he looked at current market conditions, volatility and how to manage a share portfolio in these conditions. In this chat Simon also focuses one of his stock picks (AdaptIT, JSE code: ADI) and his check list. The check list (below) is a simple first filter to find quality stocks worth investigating further. The full video is here.

The check list;

• 3 year total return +20%
• Increasing revenue over 5 years
• Increasing earnings over 5 years
• Increasing dividends
• Increasing gross margin
• Increasing ROE
• Outstanding shares stable or decreasing
• PE, P/B, P/S, PEG, FPE in range
• Current ratio, LT-Debt/Equity
• Management quality

We Get Mail

• Ros
  • Once I've put my annual R30,000 into my TFSA, and I've also reached my tax-deductible limit in terms of my RA contribution, would it still be better to invest within the RA for the tax advantages it provides on withdrawal? Or should I just buy ETFs directly?
• Brenda
  • My daughter is now in Grade 10. Over the years I have been saving in unit trusts for her university fees. I stopped the monthly debit orders at the beginning of the year when I realised that the performance did not justify the fees. I now have almost R500k in two unit trust. On the one hand I do want some capital protection but also want growth with some income so that she can have funds for a car, deposit for a flat etc. I know that I can do better investing in the market. Should I :

1. Liquidate the unit trust and open a trading account in her name?
2. Start with about five shares - I am considering Coronation, Old Mutual, Steinhoff, Discovery and Mediclinic.

• ABSA MAPPS PRO ETF
• NFILBI
• BBET40
• DBXWD
• DIVTRX 

JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.

Realistic expectations and success

Simon Shares

• The rand is back where it was when then Finance Minster Nene was fired. So everybody who was lamenting that they missed their chance to get money offshore into USD, here's your second chance.
• The NewFunds ILBI (JSE code: NFILBI) is our focus ETF this week. Tracking inflation linked bonds it sounds perfectly boring but actually looks really interesting for a broad ETF portfolio.
• Expectations. What are your expectations from your trading and/or investing? Are they reasonable? Are they hurting your ability to create wealth?

We Get Mail

• Terrance
  • I also hold Astoria (JSE code: ARA), I bought @ R15.14- 10% of portfolio already down 6.8% but so also is the rand/dollar, I was wondering on your thoughts regarding its value and comments by Keith Mclachlan as there seems quite a bit of negativity surrounding its value and costs. I bought it for the long term 5-10 years and the purpose 2 fold to invest in other markets and rand hedge. Is this all just hear say and noise?
• Everybody
  • What about putting your emergency cash into your bond?

JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.

Hating on unit trusts

Simon Shares

• SPIVA results for South Africa are out and they track how many active managers fail to beat the index. Truth is that even over 1 year most do NOT beat the index. In short, buy passive or lose money? The PDF of the report is here.
• Standard & Poors has downgraded SA's expected GDP for 2016 from 1.6% to 0.8% further cementing the likelihood of a downgrade to junk from the rating agency.
• African Bank has relaunched, but this is not the one you have shares in. The suspended ABIL sold off good assets and is left with a giant pile of debt and those left holding ABIL when it was suspended in August 2014 hold worthless shares.
• The Satrix Resi (JSE code: STXRES) is our focus ETF this week.
• We published our bubble graphic of Top40 individual stock returns for Q1 2016.

Helena Conradie CEO Satrix

Satrix is best known for their Exchange Traded Funds (ETFs) but have in recent years also moved into index tracking unit trusts. The question is why and if unit trusts are still the evil rip off they were back in the day? It is still a case of watch the fees and know what's inside?

We Get Mail

• clintvanhere via Twitter
  • If you withdraw from TFSA, what are the effects on your annual & lifetime limits?
• Ryno
  • Can I trade your lazy system in a tax free savings account ? http://justonelap.com/lazy-trading-system/
• Fathima
  • After attending your seminar for beginners, I invested in ETFs. However yesterday, I watched your video explaining the benefits of TFSA and I need to know if I made a mistake opening an non TFSA account? Should I close that account and open a TFSA, or keep both? I don't want to incur extra costs.

JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.

Simon Shares

• Capitec (JSE code; CPI) results were solid but bad debts are rising. So is their profits but the bad debts are what we're watching at this point in the process.
• Momentum portfolio doing as it says on the sticker. Good out performance on down days, modest or under performance on up days. But the gold volatility remains wild.
• ZAR X, the first new stock exchange in South Africa in over a century arrives in September.
• We review the Swix40 ETF for those wanting an alternative Top40.

Jean Pierre Verster 36One Asset Management

We last spoke to Jean Pierre in January when all was looking ugly, now everything looks all lovely, but is it? And if this is the year that shorting is as important as going long, is this the testing year for DIY investors? We also touch on inflation, commodities and the US economy.

We Get Mail

• Ryno
  • I was reading about hedge funds and came across Ray Dalio. He adheres to the all weather portfolio. Basically he says that its all in asset allocation. -55% bonds -30% shares -7.5% gold -7.5% commodities.
• Marion
  • I understand the idea behind an emergency cash fund. But where do I park it?
• Pieter
  • I have been contemplating opening an offshore account, but have refrained because of our weak currency and my lack of knowledge about international trading. My question is if it is the right time to take money off shore/open an account? Also which ETF's should one be looking at?

JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.

When to sell?

Simon Shares

• Yesterday, 23rd March, Just One lap turned five. It's been an awesome ride which we couldn't have down without the support of our users. So you everybody, thanks. A huge thank you.
• When to sell? Different answer depending if you are trading or investing.
• Great video from Anthony Clark on his top 5 small cap stocks for 2016.
• Divtrx ETF for those wanting dividends.

We Get Mail

• Tebogo
  • I was wondering if it would be advisable to liquidate part of my portfolio held in ETF and use funds to buy ETFs in my TFSA and moving forward fill up my R30k allowance before buying equities in my investment portfolio.
• Patrick
  • How often should I rebalance my portfolio?

JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.