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Could cash really be a better investment than equities?

28 August 2018 | Equities

With the benefit of hindsight, investing in SA cash over the past year (or even three) looks like a relatively sensible decision. At least, that’s the retort many investment professionals are currently facing as they sit in front of their clients. According to MorningStar (a data provider), the average SA balanced fund (which can invest in cash, but typically holds up to 75% in equities) has returned a negative 0.7% per annum after inflation over the past three years, compared to SA cash that has delivered a positive +1.6% per annum real return.

Why hedge funds are not the best choice for investors

28 August 2018 | General

Few topics get fund managers more emotional than investment fees. Few things destroy your retirement fund more than high investment fees. Few topics generate more interest than fund manager performance – or lack thereof. Combining high fees with poor performance is bound to spark even more interest and debate.

Strong US economy showing few signs of trade concerns

23 August 2018 | Economy

The US economy has continued to perform well on many fronts, with positive readings for growth, employment and inflation. In terms of growth, the stimulus effect from tax cuts was clearly visible in second-quarter 2018 data, and could be maintained for at least another quarter, in our view. We would expect to see a gradual rise in both wage growth and the rate of inflation, as companies respond to labour market shortages and try to push through price increases. We believe the main uncertainty facing the economy remains the ultimate impact of the Trump administration’s trade policies. As the mid-term congressional elections approach—and with little sign of negative economic or political consequences domestically from President Donald Trump’s actions thus far—any tempering of his administration’s unilateral agenda on trade seems unlikely.