Seek out an in­vest­ment as you would a fine wine

Weekend Argus (Saturday Edition) - - PERSONALFINANCE - Bruce Cameron

t is in­ter­est­ing how of­ten the stan­dards set for ex­cel­lence in one sphere are much the same as those in another.

Among my in­ter­ests are good in­vest­ments (ob­vi­ously), test cricket and good wine.

T20 cricket to me is com­pa­ra­ble to day trad­ing on the stock ex­change. It is not in­vest­ing – it is sim­ply a form of gam­bling. You are go­ing out there and slog­ging with an equal chance of be­ing bowled as of hit­ting a six. The in­vest­ment ver­sion of T20 – day trad­ing – can be equally hit or miss.

Test cricket, on the other hand, is a longert­erm af­fair, with care­fully pre- planned tac­tics. It is much like in­vest­ing for the long term to achieve sound and sus­tain­able re­turns.

Then there is wine. Good wine, like good test cricket and wise in­vest­ing, needs ex­per­tise and time. I was re­minded of this re­cently when the 2014 edi­tion of John Plat­ter’s sem­i­nal guide to South African wine was pub­lished.

The Plat­ter’s South African Wine Guide was first pub­lished in 1980, beat­ing Per­sonal Fi­nance by 16 years. It is the first and best wine guide in South Africa, and has won in­ter­na­tional awards – much the same sta­tus I like to claim for Per­sonal Fi­nance – namely the best of its kind in South Africa, whose staff have won a great many awards for ex­cel­lence.

IAn im­por­tant rea­son for our suc­cess is that we re­search and an­a­lyse as much as we can in the broad fi­nan­cial sec­tor to help you un­der­stand what is good and bad. In turn, you can make con­sid­ered de­ci­sions, en­abling you to be a test crick­eter or wine mas­ter in your per­sonal fi­nan­cial de­ci­sion-mak­ing.

The same ap­plies to Plat­ter’s. Over the years, it has de­vel­oped a sound rep­u­ta­tion for its pre­sen­ta­tion of what is good and bad. To achieve this, like Per­sonal Fi­nance, it uses peo­ple who are deeply knowl­edge­able about their sub­ject. So, are there many sim­i­lar­i­ties in se­lect­ing a sound longterm fi­nan­cial prod­uct and in se­lect­ing a Plat­ter five- star wine? There are a num­ber.

I asked the ed­i­tor of Plat­ter’s, Philip van Zyl, what judges look for in a good wine. He, in turn, asked

his panel of tasters to list the ma­jor at­tributes they look for in Plat­ter’s five-star wines, cri­te­ria he en­dorses as well.

The cri­te­ria are di­vided into two cat­e­gories: in­trin­sic and ex­trin­sic fac­tors.

In the ta­ble, I com­pare the cri­te­ria for a good wine with those for a sound in­vest­ment. Not all are com­pa­ra­ble, but most are.

So next time you sit down to look at your per­sonal fi­nan­cial af­fairs, think of them in the con­text of a good wine!

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