Investors should take a long term view says ACI

South African investors should ride out the volatile markets and take a long term view of the investment outlook, says Di Turpin (pictured) Chief Executive of the Association of Collective Investments.

“We have seen volatile markets before and know that investment prospects will again recover once markets have settled down. After the recent world-wide equity sell-off now is certainly not the time to re-shuffle portfolios.

“Investors should be reassured by the strong action taken by the Federal Reserve which has led to calmer trading on Wall Street and global markets in general.”

Turpin says that the well regulated South African Collective Investment industry has thus far continued to attract net inflows throughout the sub-prime crisis: Net inflows during the June quarter - the most recent period for which statistics are available - were just below the R10 billion mark.

‘One of the reasons is that investors realize the long term growth potential and out performance of collective investments.”

South African investors have been less affected by the fall in equity prices than their counterparts elsewhere as their equity holdings have been low compared to fixed interest.

The latest statistics show only 27 percent of funds invested in equities against 47 percent in fixed interest. Overseas investors have nearly half of their investments in equities.