An investment rationale that makes real investment sense
With South Africa representing less than 2% of the world economy, and local markets not performing well, many investors would like to diversify their investment portfolios and benefit from the growth potential of European and US share markets, but do not want a currency risk, the risk of zero return or losing any of their capital, but at the same time would prefer not to run the risk of direct equity exposure.
There is a global movement towards index-linked investment strategies, many of them socalled “factor” or “risk premia” indices. This investment style aims to outperform the benchmark for market cap weighted indices, while maintaining a very low risk factor. This is achieved by applying a daily risk-control mechanism with a target volatility control level by adjusting equity exposure and cash on a daily basis. The index aims to produce higher returns by lessening the effect of downward movement in the index and increasing the effect of upward movement.
A major SA bank has recently released into their investment solution portfolio two unique investment vehicles with the aim to give investors capital growth over rolling three to five-year periods. These investment solutions will follow the above index-linked approach.
The investor will have an option of investing in a product that has a fixed three-year guaranteed income portion 13.5% p.a. and a portion allocated to a basket of the S&P500 and Euro Stoxx50 indices, or you can opt to invest in a product that only tracks the Euro Stoxx50 performance, but with an enhanced growth added to the proceeds. Investors may also prefer to combine the two options to diversify even further and thereby solidify their investment portfolios.
Both these two solutions will start
The investor will have an option of investing in a product that has a fixed three-year guaranteed income portion 13.5% p.a.
from as little as
R250 000 with full initial capital guaranteed, furthermore the proceeds are tax-free in the hands of the investor and 100% of the capital is allocated to the investment. These investment opportunities will be available for a limited period only.
Please refer to the advertisement below for more information about how to make a sound investment.