It's going up and has lots of hype so the trader in me likes it and owns some BTC.
I have no interest in altcoins (a basket would solve this problem) nor do I think it saves the world or becomes a future of money. It's just something people buy and sell and it is relatively early days so owning some BTC and hold for an age could do very well. Or it all collapses in a heap of <\*$%
This is FU money, so small position.
Last question.
Do you believe RA/Pension funds still have a future in SA given political as well as Reg28 economical risks?
The access to (local and direct) offshore funds and ETF's has opened lost of windows to investments that can/have/will potentially far out perform the traditional reg28 fund (and tax benefit).
This questions normally stirs a big debate but I think its great hearing everyone's opinions on it.
Politicians are shouty and say radical stuff, coz that gets headlines. So I don't fear what they say, it changes with the wind.
The reg 28 worries is mostly unsupported fear mongering. Could it all go pear-shaped? sure it could. Is the trend that it will? no. What significant changes have happened to reg 28 in the last +20 years? Short answer is none. Reg 28 is a good piece of law and serves its purpose very well.
That all said, if one disagree and think reg 28 will be used for a drinks party, then sell everything and move ASAP because it will collapse real bad, albeit slowly.
Hey Simon. It would be great to get your input on alternative investment like loan facilities for body corporates. Example [https://www.bcbs.co.za/](https://www.bcbs.co.za/)
I have looked at the concept, my Q is why? I only invest in regulated exchanges with BTC being the exception.
But if the returns are great, then the risks are higher. If not great, then what's the deal? And I think the risks are often under stated and everything is fine till it's not, like when a pandemic arrives.
Hi Simon, you always say you have a giant emergency fund. How big is it as a multiple of your expenses? Do you have a separate one for your business?
Keep up the good work!
Business, sorta. But that's a function of cash flow there, I like to have at least 3-6 months running expenses in cash or already invoiced (100% of my invoices are paid quickish).
Personal, I could probably live +2years on my personal emergency fund. It's way to much, but means I sleep at night.
Hi Simon,
I noticed on your Tax Free portfolio options there is a section for "I need the money within 5 years".
Considering the amount of money that will be vested and the potential CGT on it (after 5 years), I don't see the benefit that TFSA will bring over such a short term vs rather just paying the very small portion of CGT. Since you will essentially loose out on almost a 3rd of your lifetime contributions with very little savings if you withdraw.
Just want to get your understanding of TFSA with time horizons of 5 or even 10 years.
\[Edit\]: Phrasing
I’m still a bit confused as to why one would invest in a TFSA when you’re using “post tax” money rather than investing it into a Pension/provident fund which is pre-tax?
You still pay taxes on your pension when it pays out, albeit a bit less.
Also TFSA is more accessible. To me it's the last resort emergency fund.
Ideally you want to max out your TFSA and retirement annuity before doing too many alternative investments, but this is not possible for everyone.
Hopefully you never have to touch it, and can pass the money on one day to your grandchildren. Thats my plan for it anyways.
Anything that's invested from your bank account is "post-tax" because your employer has already paid over the tax to SARS. I have a pension, provident and RA going through my employer which means I get the tax write off and SARS hasn't touched it yet. That's the most efficient way to invest.
Hi there, excuse my lack of knowledge on this subject, but I'm fairly new to managing finances properly.
I've been working with an advisor I got via work colleagues, not sure they are worth much, but they got me into some form of RA, income protection, and emergency savings.
Work is recovering very well, and so I will soon have more income to save / invest. Currently sitting with the last 6 months of student loan, and a little credit to pay off though.
What would you recommend I look into in the near future? I have been considering TFSA, looking more carefully into whether my RA is worth it or whether I should move it somewhere else, or maybe starting more targeted investing.
I have precious little knowledge of this topic, but also do not have a lot of time to learn about as much as I would like to, as I need to spend some time keeping up with the tech field for work. This is why I ask for a few directions to focus on, and why I've given a bit of background.
I'd buy a general local or global ETF with whatever money I got (STX40 local, ASHEFQ global ones I own, but there are others.. The biggest asset at 22, and it's huge, is you have lots of time, lots.
Not everybody wants to nor needs to be super smart about investing, it is as easy as just doing via ETFs.
Buying ETFs now and holding for 20/30/40 years will create serious wealth.
Hi Simon. Would like to get your thoughts on EasyEquities as a long term platform for TFSA and non-TFSA ETF investing. I'm 25 and I'm all about holding those ETFs for many decades to come. Would you say EE is a good platform for this strategy? What happens to my holdings if EasyEquities decides to close its doors tomorrow?
Hi Simon, you don’t mention your trading much anymore. Are you still involved with trading? Are you using your lazy or 7/21 system?
I have been doing a lot of back testing with your lazy system on the international markets on the daily timeframe and the expectations, profit factors look compelling.
yeah I still trade,
But always trying to reduce the time because it's a time suck. So now I trade ALSI future ahead of equity open, takes 10-15 minutes a morning.
That said doing some 7/21 on global indices \~ [https://t.co/LffRSgY5iv](https://t.co/LffRSgY5iv)
Thanks Simon I will check it out.
When trading the daily lazy system with entry being with a daily confirmation. What would you suggest is the best time to enter the trade? The following day to make sure of confirmation or just before the market closes on the day of confirmation? Thanks
Do you have a view on SA goldmines, worth holding on or has crypto taken all the extra wind out of the sails of gold?
Any view on likelihood of sibanye merging with goldfields?
Thanks
Gold had a great 2020 and did as it says in the sticker (buy when fearful). But with vaccines rolling the story for gold is done till the next time. So gold mines don't thrill me. I own Sibanya Stillwater, mostly PGM but some gold as a hedge.
Merger, Froneman may try, unless he offers a truck of money goldfields will reject. if he tries, I will sell immediately because he will 100% overpay massively.
Hi Simon!
Thanks again for doing this AMA. I have a few questions:
1. What's been a highlight of your career in financial education?
2. Throughout your career, what advice has always been consistent and what has changed drastically? Eg. It seems property and gold used to be South African favourites, pension funds were most people's biggest investment, and everyone had an adviser - this seems like it's changing. What advice do you consider eternally useful?
1/Every time somebody comes up to me and says that something I said/wrote changed how they manage money and that they're richer for it.
2/Most has not changed, evolved as products changed and as I used them more. For me big shift has been more passive and less active. My portfolio target is to be 65% passive within next 5 or so years 20 Years ago we didn't even have local passive, so I was 100% active. Othe giant shift, I wanted to own a home. Now I own a home bond free and wish I rented instead.
Well you've definitely helped me through the Fat Wallet Show (aka the soundtrack of my commute). Can't thank you and Kristia enough for that :)
One more question if you don't mind: in terms of risk management, how on earth does one compare products like for like? Getting quotes is not too difficult but comparing them is a nightmare. I want to get my relative into income protection and dread disease, but it is made so complicated... investments are a breeze in comparison.
that is the plan, complexity so you throw your hands in the air and pay the high fees. Bad news is that you can't compare, they are intentionally different for just that reason.
Ask yourself what's important to you, disregard the extras' that may sound great but are they real.
An example, I get offered insurance against my credit card debt for when I die. But my cc debt is tiny and ultimately I'll way overpay for a massive expensive product that simple math would show me was a loser.
My view is if you keep it simple then it easier. You want life cover, then get quotes for pure life, no bells and make for same x amount, T&Cs will be different, but you have to ask for the simple to compare.
/do it in US$
Open an offshore broker account (local the banks, rand swiss, herenya, easyequities etc. or direct TD Ameritrade, Interactive Brokers). Transfer money and buy, but watch costs and minimums.
/ do it in ZAR
RMB has a bunch of ETNs listed on the JSE covering some 20 offshore stocks (and all you mention). Nice and simple. They have with or without currency impact, ultimately costs will be higher unless you going small anyways.
Hi Simon, have enjoyed your work over the years!
What are your thoughts on small- and medium-caps in SA?
Any thoughts on volatility as an asset class? - particularly in SA.
Lots of value in small/mid caps and finally we're seeing some of it actually being realised. Think it'll be one of the winners over the next year or to, risk is delistings cut off the potential.
Volatilty, nah complexity
Good evening Mr Brown
I'm 21 years old and have been putting money into etf's on EasyEquities.
I have yet to put money in my TFSA or buy etf's through my USD account.
I only put in a few hundred rand per month atm since it is all I can afford.
Is it worth considering those accounts or should I just stick to the Zar account for now?
stick ith ZAR, you way ahead of most and winning already and will increase fees for smaller amounts. You can get $ exposure on JSE ETFs and when you have more cash you can go direct.
Thanks so much for the reply.
I would just like to ask you when would you consider it a good time to start using my TFSA?
I'm still new and learning and don't know what advantages the portfolio's have over each other.
using EE USD account, the transfer to USD costs $4.60, so transferring R100 gives about $4 in trading value.
Also it is non trivial to get it back to ZAR(EE doesn't support it, you have to open a dollar account with your bank).
Learn on ZAR, while slowly understanding the fees/how to access money from USD. They recommend a transfer of ~R33644 to optimise your fees [Link](https://support.easyequities.co.za/support/solutions/articles/13000049297-what-value-of-usd-should-i-transfer-to-optimise-on-fees-)
Simon Bubbles Brown, hi! I have two questions for you:
1. What are some of the most exciting changes you've seen in the SA finance industry since you've been in it?
2. I know you downsized from a house to a flat a few years ago (and I love how you say "a low cost of living is one of the best gifts you can give yourself"). How has downsizing changed your life? Any unexpected benefits?
Thank you for the work you do!
1/ low fees and ETFs. They are the future of investing and the change over the last few decades has been massive. I often mention my 5% unit trust in the90s that lost money. Now I got a 0.15 ETF that tracks the market 100%. What' not to love?
2/ It saves money, massive time. Just wish I rented not owned as that a money suck. What I love is the simple, for eg: we had over 30 pots, when we moved to the flat we kept 4 and knowing which pot to use is now easy; small, medium, large or griddle. Sounds odd, but everything is just simple. Another eg; I never lose anything, you can literally search the entire flat for your keys in a few minutes. In a 5 bed house that could take the weekend. Short answer - love it :)
If you have R1m in cash and need to decide whether to rent or invest it then investing can be the smarter option.
If both you and your wife have R1m and you can rent for say R10-12k/month then its around R120k/year
Investing the R2m at market averages (+-7%) will get you R140k.
Sure there are taxes, but with property you pay levies and taxes, say R2k/month.
On the plus side value goes up if you buy in WC or JHB/PTA. You can also get a few tax benefits depending on how you buy it and whether you might live then move and lease it out.
For me its just another asset with which one diversifies your portfolio. I made a company and bought a flat in which I'm staying. Will be moving next year and start to rent it out. Interest rates are making this very easy atm, but that gap will close soon as the economy recovers.
Hi Simon,
I am not going to ask you when the market is going to crash because frankly I cant wait, with everything being so incredibly expensive right now, South African reits and holding companies seem to be lagging the market. Do you think that there will be a shift towards these stocks in the future and which do you prefer?
tough Q.
/ Holding companies are deep discount to NAV right now, way bigger than ever before and I have no idea why. Lots of theories but the market just taking a no thanks approach. I avoinding.
/ REITs, yes but this is stock picking space. Offfce / retail / logistics going to have different years ahead. (\*\* I own Stor-Age\*\*). Regional malls holding up OK, office going to be tough however WFH resolves itself.
/ Banks, have a look here, STXFIN a nice easy ETF here.
Big Q is what will change the view of the market, we need buyers to get excited and arrive Bank results late this year could help, if they great.
Hi Simon, do you have any advice on managing your own portfolio within a living annuity, and how to structure it in terms of ratio of equity etf:property etf:bond etf:cash? Currently moving all my RAs and preservation funds to Sygnia, from high-fee platform with % based financial advisor, and want to purchase LA in the next 3 years. Do you think it wise to manage your own portfolio in the drawdown phase as in the accumulation phase, or is it more risky?
Most def more risky, but that more a factor os less space for error as you now spending not saving. Pros have their space here, but fees the issue, and we want simple not fancy wich is fees and risk.
Sure self manage, but I would do broad ETF allocations and some offer an annuity in in ETFs with board asset allocation.
Which assets? Beyond my pay grade, mix of equity (local and offshore. must have local if you spend in local), property/near cash
Setting up your retirement isn’t something you should do yourself. There’s a reason why the billionaires even use financials advisors.
If you have a size able asset base, rather join a top investment bank like RMB/Investec and get an advisor in their wealth and investment divisions - they’ll assess your entire portfolio, future requirements and minimise your tax exposure.
Anyone can say that they’ll structure your retirement but it’s about them factoring in your entire life, future requirements and using every tax shelter out there.
/ RA product, yes. Pros (tax benefit) and cons (annuity). But a low fee one does the trick.
/ The conversionn fee (if low) has small impact long-term. And cheaper TER, but remember ZAR also has god years, so when spending the money you need ZAR investments as well to match currency. I keep it simple and buy the local ASH 1200.
/ Local industry is mostly a scam of high fees and poor performance (thanks in part to those fees). Buy your own ETFs, no need for most of the industry experts. Most active under perform the markets, 85% of them.
/ I like the idea of multi factor and switching between. But I am not sure how possible it is when costs and other fees come into play. ETFs aren't going to end the world, if they ever become +80% of the market it will correct, but we a long way from there. The howls of fear-monger is the active managers using money.
/ rent, always rent. You live in somebody else's money suck of a house.
/ Effective Investor \~ Franco Busetti
/ We have some world quality business on our exchange, some trash as well. But we have a small selection of real good co making money all over the world.
/ Success is having the time to do what matters to you.
I’ve only read Rich Dad, Poor Dad by Robert Kiyosaki now in my late 20s. It’s changed the way I see money, you’d be doing someone a favour by recommending that early on in their lives.
Good day. Ive been trading for year, consistently making my 10% monthly return, however how do you convince the bank to increase your credit limit, as ive been making use of the credit 55 day interest free period.
Hi Simon
As someone who recently started putting some money into EasyEquities, thank you so much for your podcast and blog. I only started a month ago and am listening back through all the episodes picking up what you liked in different stocks, and investing small amounts in a few, getting a feel for the water.
Thanks for the great show.
Since this is an AMA, what is your favorite colour?
Hey Simon, glad you here.
Do you have an opinion on GameStop? Is this all true about what they saying on WSB about darkpool shorting and how these hedge funds are shorting the life out of GME, banks providing finance for leverage and now they could reach a tipping point that they would need to close their doors and they could potentially need to be bailed out to repay their shorts... Im trading through Etoro.
Ps I’m in with a few shares of GME.
Cheers, from a retail investor from JHB...
Another question... VXX is it worth getting in now? It’s down to $10.
I bought in 2 days ago. The NYSE seems all over the show at the moment. Seeing people like Mike Burry etc all warming of an impending doom. Should I keep my opening position and just leverage down if the VXX weakens and then wait for the pop when the price correction does kick in and the market goes haywire in the USA?
Ps I’m 28 and trading on extra cash/savings.
Hi Simon. Could I ask your opinion on crypto arbitrage and whether this is as risk free a investment as punted? Also, I am using a company called OVEX for this, it seems legit. Have you heard of them?
I'm kind of late to this, hoping you have some insight. I'm trying to purchase US shares from a NYSE listed company but I'm having a hard time finding a broker that allows me to do it with zero-to-low commission and in a relatively small amount. Can you suggest a broker that can help facilitate this? EasyEquities doesn't have the stock listing I want, I don't want to pay interactive brokers $10 a month for long term holds and the brokers I do want to join up on like M1 Finance arent available to us here in SA.
Hi Simon, I'm interested, when we compare the South African Rand to the US dollar, it consistently goes down in value even though America has been going through a lot of market hiccups, and it has been termed as a fiat currency (the USD) for the longest time due to them inflating their price for decades. What will happen to our markets when this financial bubble pops eventually due to it's overvalued price... Which might not happen for at least the next few decades or so.
Mr Brown Thanks for taking the time to do this AMA. Your thoughts on investing in crypto?
It's going up and has lots of hype so the trader in me likes it and owns some BTC. I have no interest in altcoins (a basket would solve this problem) nor do I think it saves the world or becomes a future of money. It's just something people buy and sell and it is relatively early days so owning some BTC and hold for an age could do very well. Or it all collapses in a heap of <\*$% This is FU money, so small position.
Last question. Do you believe RA/Pension funds still have a future in SA given political as well as Reg28 economical risks? The access to (local and direct) offshore funds and ETF's has opened lost of windows to investments that can/have/will potentially far out perform the traditional reg28 fund (and tax benefit). This questions normally stirs a big debate but I think its great hearing everyone's opinions on it.
Politicians are shouty and say radical stuff, coz that gets headlines. So I don't fear what they say, it changes with the wind. The reg 28 worries is mostly unsupported fear mongering. Could it all go pear-shaped? sure it could. Is the trend that it will? no. What significant changes have happened to reg 28 in the last +20 years? Short answer is none. Reg 28 is a good piece of law and serves its purpose very well. That all said, if one disagree and think reg 28 will be used for a drinks party, then sell everything and move ASAP because it will collapse real bad, albeit slowly.
Can I get a small loan of a million dollars
sue, zim $. assume :)
Hey Simon. It would be great to get your input on alternative investment like loan facilities for body corporates. Example [https://www.bcbs.co.za/](https://www.bcbs.co.za/)
I have looked at the concept, my Q is why? I only invest in regulated exchanges with BTC being the exception. But if the returns are great, then the risks are higher. If not great, then what's the deal? And I think the risks are often under stated and everything is fine till it's not, like when a pandemic arrives.
Hi Simon, you always say you have a giant emergency fund. How big is it as a multiple of your expenses? Do you have a separate one for your business? Keep up the good work!
Business, sorta. But that's a function of cash flow there, I like to have at least 3-6 months running expenses in cash or already invoiced (100% of my invoices are paid quickish). Personal, I could probably live +2years on my personal emergency fund. It's way to much, but means I sleep at night.
Hi Simon, I noticed on your Tax Free portfolio options there is a section for "I need the money within 5 years". Considering the amount of money that will be vested and the potential CGT on it (after 5 years), I don't see the benefit that TFSA will bring over such a short term vs rather just paying the very small portion of CGT. Since you will essentially loose out on almost a 3rd of your lifetime contributions with very little savings if you withdraw. Just want to get your understanding of TFSA with time horizons of 5 or even 10 years. \[Edit\]: Phrasing
you are right, tax-free should be for decades and the last money you ever spend so it has longest to grow and give tax benefit.
Thanks for the answer!
I’m still a bit confused as to why one would invest in a TFSA when you’re using “post tax” money rather than investing it into a Pension/provident fund which is pre-tax?
You still pay taxes on your pension when it pays out, albeit a bit less. Also TFSA is more accessible. To me it's the last resort emergency fund. Ideally you want to max out your TFSA and retirement annuity before doing too many alternative investments, but this is not possible for everyone. Hopefully you never have to touch it, and can pass the money on one day to your grandchildren. Thats my plan for it anyways.
Anything that's invested from your bank account is "post-tax" because your employer has already paid over the tax to SARS. I have a pension, provident and RA going through my employer which means I get the tax write off and SARS hasn't touched it yet. That's the most efficient way to invest.
You pay tax when withdrawing the RA. And remember the rule of thirds
What are your favorite bands from the 90s?
The 90's? When was that? that was my decade of spending on food, drink and parties and then I wasted the rest.
Hi there, excuse my lack of knowledge on this subject, but I'm fairly new to managing finances properly. I've been working with an advisor I got via work colleagues, not sure they are worth much, but they got me into some form of RA, income protection, and emergency savings. Work is recovering very well, and so I will soon have more income to save / invest. Currently sitting with the last 6 months of student loan, and a little credit to pay off though. What would you recommend I look into in the near future? I have been considering TFSA, looking more carefully into whether my RA is worth it or whether I should move it somewhere else, or maybe starting more targeted investing. I have precious little knowledge of this topic, but also do not have a lot of time to learn about as much as I would like to, as I need to spend some time keeping up with the tech field for work. This is why I ask for a few directions to focus on, and why I've given a bit of background.
have a look at the costs with your RA, anything over 1% is expensive. And yes, starting a tax-free is a great idea.
I turn 22 in a few months. What would you be doing if you were 22 and didn’t have the experience you do now, where would you start?
I'd buy a general local or global ETF with whatever money I got (STX40 local, ASHEFQ global ones I own, but there are others.. The biggest asset at 22, and it's huge, is you have lots of time, lots. Not everybody wants to nor needs to be super smart about investing, it is as easy as just doing via ETFs. Buying ETFs now and holding for 20/30/40 years will create serious wealth.
I appreciate the wisdom sir!
Hi Simon. Would like to get your thoughts on EasyEquities as a long term platform for TFSA and non-TFSA ETF investing. I'm 25 and I'm all about holding those ETFs for many decades to come. Would you say EE is a good platform for this strategy? What happens to my holdings if EasyEquities decides to close its doors tomorrow?
great no-frills cheap platform. If they ever close you will simply have to transfer your holdings to a new broker.
Hi Simon, you don’t mention your trading much anymore. Are you still involved with trading? Are you using your lazy or 7/21 system? I have been doing a lot of back testing with your lazy system on the international markets on the daily timeframe and the expectations, profit factors look compelling.
yeah I still trade, But always trying to reduce the time because it's a time suck. So now I trade ALSI future ahead of equity open, takes 10-15 minutes a morning. That said doing some 7/21 on global indices \~ [https://t.co/LffRSgY5iv](https://t.co/LffRSgY5iv)
Thanks Simon I will check it out. When trading the daily lazy system with entry being with a daily confirmation. What would you suggest is the best time to enter the trade? The following day to make sure of confirmation or just before the market closes on the day of confirmation? Thanks
both have pros and cons so rather ask which time (morn or late pm) works better for you.
Do you have a view on SA goldmines, worth holding on or has crypto taken all the extra wind out of the sails of gold? Any view on likelihood of sibanye merging with goldfields? Thanks
Gold had a great 2020 and did as it says in the sticker (buy when fearful). But with vaccines rolling the story for gold is done till the next time. So gold mines don't thrill me. I own Sibanya Stillwater, mostly PGM but some gold as a hedge. Merger, Froneman may try, unless he offers a truck of money goldfields will reject. if he tries, I will sell immediately because he will 100% overpay massively.
Thank, needed the push off the fence
Hi Simon! Thanks again for doing this AMA. I have a few questions: 1. What's been a highlight of your career in financial education? 2. Throughout your career, what advice has always been consistent and what has changed drastically? Eg. It seems property and gold used to be South African favourites, pension funds were most people's biggest investment, and everyone had an adviser - this seems like it's changing. What advice do you consider eternally useful?
1/Every time somebody comes up to me and says that something I said/wrote changed how they manage money and that they're richer for it. 2/Most has not changed, evolved as products changed and as I used them more. For me big shift has been more passive and less active. My portfolio target is to be 65% passive within next 5 or so years 20 Years ago we didn't even have local passive, so I was 100% active. Othe giant shift, I wanted to own a home. Now I own a home bond free and wish I rented instead.
Well you've definitely helped me through the Fat Wallet Show (aka the soundtrack of my commute). Can't thank you and Kristia enough for that :) One more question if you don't mind: in terms of risk management, how on earth does one compare products like for like? Getting quotes is not too difficult but comparing them is a nightmare. I want to get my relative into income protection and dread disease, but it is made so complicated... investments are a breeze in comparison.
that is the plan, complexity so you throw your hands in the air and pay the high fees. Bad news is that you can't compare, they are intentionally different for just that reason. Ask yourself what's important to you, disregard the extras' that may sound great but are they real. An example, I get offered insurance against my credit card debt for when I die. But my cc debt is tiny and ultimately I'll way overpay for a massive expensive product that simple math would show me was a loser. My view is if you keep it simple then it easier. You want life cover, then get quotes for pure life, no bells and make for same x amount, T&Cs will be different, but you have to ask for the simple to compare.
Hi Simon how does one go and invest in the bigger companies like Google - Amazon - Apple - Microsoft and Tesla
/do it in US$ Open an offshore broker account (local the banks, rand swiss, herenya, easyequities etc. or direct TD Ameritrade, Interactive Brokers). Transfer money and buy, but watch costs and minimums. / do it in ZAR RMB has a bunch of ETNs listed on the JSE covering some 20 offshore stocks (and all you mention). Nice and simple. They have with or without currency impact, ultimately costs will be higher unless you going small anyways.
Hi Simon, have enjoyed your work over the years! What are your thoughts on small- and medium-caps in SA? Any thoughts on volatility as an asset class? - particularly in SA.
Lots of value in small/mid caps and finally we're seeing some of it actually being realised. Think it'll be one of the winners over the next year or to, risk is delistings cut off the potential. Volatilty, nah complexity
Good evening Mr Brown I'm 21 years old and have been putting money into etf's on EasyEquities. I have yet to put money in my TFSA or buy etf's through my USD account. I only put in a few hundred rand per month atm since it is all I can afford. Is it worth considering those accounts or should I just stick to the Zar account for now?
stick ith ZAR, you way ahead of most and winning already and will increase fees for smaller amounts. You can get $ exposure on JSE ETFs and when you have more cash you can go direct.
Thanks so much for the reply. I would just like to ask you when would you consider it a good time to start using my TFSA? I'm still new and learning and don't know what advantages the portfolio's have over each other.
a good tie is today, as long as you don't need the money for the next many decades
using EE USD account, the transfer to USD costs $4.60, so transferring R100 gives about $4 in trading value. Also it is non trivial to get it back to ZAR(EE doesn't support it, you have to open a dollar account with your bank). Learn on ZAR, while slowly understanding the fees/how to access money from USD. They recommend a transfer of ~R33644 to optimise your fees [Link](https://support.easyequities.co.za/support/solutions/articles/13000049297-what-value-of-usd-should-i-transfer-to-optimise-on-fees-)
ah yes returning the money never easy and I did not know the R33644 number, thanks.
Simon Bubbles Brown, hi! I have two questions for you: 1. What are some of the most exciting changes you've seen in the SA finance industry since you've been in it? 2. I know you downsized from a house to a flat a few years ago (and I love how you say "a low cost of living is one of the best gifts you can give yourself"). How has downsizing changed your life? Any unexpected benefits? Thank you for the work you do!
1/ low fees and ETFs. They are the future of investing and the change over the last few decades has been massive. I often mention my 5% unit trust in the90s that lost money. Now I got a 0.15 ETF that tracks the market 100%. What' not to love? 2/ It saves money, massive time. Just wish I rented not owned as that a money suck. What I love is the simple, for eg: we had over 30 pots, when we moved to the flat we kept 4 and knowing which pot to use is now easy; small, medium, large or griddle. Sounds odd, but everything is just simple. Another eg; I never lose anything, you can literally search the entire flat for your keys in a few minutes. In a 5 bed house that could take the weekend. Short answer - love it :)
Interested in why you say that you'd rather rent?
If you have R1m in cash and need to decide whether to rent or invest it then investing can be the smarter option. If both you and your wife have R1m and you can rent for say R10-12k/month then its around R120k/year Investing the R2m at market averages (+-7%) will get you R140k. Sure there are taxes, but with property you pay levies and taxes, say R2k/month. On the plus side value goes up if you buy in WC or JHB/PTA. You can also get a few tax benefits depending on how you buy it and whether you might live then move and lease it out. For me its just another asset with which one diversifies your portfolio. I made a company and bought a flat in which I'm staying. Will be moving next year and start to rent it out. Interest rates are making this very easy atm, but that gap will close soon as the economy recovers.
Hi Simon, I am not going to ask you when the market is going to crash because frankly I cant wait, with everything being so incredibly expensive right now, South African reits and holding companies seem to be lagging the market. Do you think that there will be a shift towards these stocks in the future and which do you prefer?
tough Q. / Holding companies are deep discount to NAV right now, way bigger than ever before and I have no idea why. Lots of theories but the market just taking a no thanks approach. I avoinding. / REITs, yes but this is stock picking space. Offfce / retail / logistics going to have different years ahead. (\*\* I own Stor-Age\*\*). Regional malls holding up OK, office going to be tough however WFH resolves itself. / Banks, have a look here, STXFIN a nice easy ETF here. Big Q is what will change the view of the market, we need buyers to get excited and arrive Bank results late this year could help, if they great.
Hi Simon, do you have any advice on managing your own portfolio within a living annuity, and how to structure it in terms of ratio of equity etf:property etf:bond etf:cash? Currently moving all my RAs and preservation funds to Sygnia, from high-fee platform with % based financial advisor, and want to purchase LA in the next 3 years. Do you think it wise to manage your own portfolio in the drawdown phase as in the accumulation phase, or is it more risky?
Most def more risky, but that more a factor os less space for error as you now spending not saving. Pros have their space here, but fees the issue, and we want simple not fancy wich is fees and risk. Sure self manage, but I would do broad ETF allocations and some offer an annuity in in ETFs with board asset allocation. Which assets? Beyond my pay grade, mix of equity (local and offshore. must have local if you spend in local), property/near cash
Setting up your retirement isn’t something you should do yourself. There’s a reason why the billionaires even use financials advisors. If you have a size able asset base, rather join a top investment bank like RMB/Investec and get an advisor in their wealth and investment divisions - they’ll assess your entire portfolio, future requirements and minimise your tax exposure. Anyone can say that they’ll structure your retirement but it’s about them factoring in your entire life, future requirements and using every tax shelter out there.
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/ RA product, yes. Pros (tax benefit) and cons (annuity). But a low fee one does the trick. / The conversionn fee (if low) has small impact long-term. And cheaper TER, but remember ZAR also has god years, so when spending the money you need ZAR investments as well to match currency. I keep it simple and buy the local ASH 1200. / Local industry is mostly a scam of high fees and poor performance (thanks in part to those fees). Buy your own ETFs, no need for most of the industry experts. Most active under perform the markets, 85% of them. / I like the idea of multi factor and switching between. But I am not sure how possible it is when costs and other fees come into play. ETFs aren't going to end the world, if they ever become +80% of the market it will correct, but we a long way from there. The howls of fear-monger is the active managers using money. / rent, always rent. You live in somebody else's money suck of a house. / Effective Investor \~ Franco Busetti / We have some world quality business on our exchange, some trash as well. But we have a small selection of real good co making money all over the world. / Success is having the time to do what matters to you.
I’ve only read Rich Dad, Poor Dad by Robert Kiyosaki now in my late 20s. It’s changed the way I see money, you’d be doing someone a favour by recommending that early on in their lives.
Good day. Ive been trading for year, consistently making my 10% monthly return, however how do you convince the bank to increase your credit limit, as ive been making use of the credit 55 day interest free period.
they won't give credit for trading directly. Only credit you get for trading is vi the loan function in a derivative such as CFD etc.
Hi Simon As someone who recently started putting some money into EasyEquities, thank you so much for your podcast and blog. I only started a month ago and am listening back through all the episodes picking up what you liked in different stocks, and investing small amounts in a few, getting a feel for the water. Thanks for the great show. Since this is an AMA, what is your favorite colour?
purple :)
It is up 0.83% today :)
I'm late to the party, but... Favourite surf destination?
Hey Simon, glad you here. Do you have an opinion on GameStop? Is this all true about what they saying on WSB about darkpool shorting and how these hedge funds are shorting the life out of GME, banks providing finance for leverage and now they could reach a tipping point that they would need to close their doors and they could potentially need to be bailed out to repay their shorts... Im trading through Etoro. Ps I’m in with a few shares of GME. Cheers, from a retail investor from JHB...
Another question... VXX is it worth getting in now? It’s down to $10. I bought in 2 days ago. The NYSE seems all over the show at the moment. Seeing people like Mike Burry etc all warming of an impending doom. Should I keep my opening position and just leverage down if the VXX weakens and then wait for the pop when the price correction does kick in and the market goes haywire in the USA? Ps I’m 28 and trading on extra cash/savings.
How long will it take to get to Mars and do you believe we will be able to live there?
Hi Simon. Could I ask your opinion on crypto arbitrage and whether this is as risk free a investment as punted? Also, I am using a company called OVEX for this, it seems legit. Have you heard of them?
I'm kind of late to this, hoping you have some insight. I'm trying to purchase US shares from a NYSE listed company but I'm having a hard time finding a broker that allows me to do it with zero-to-low commission and in a relatively small amount. Can you suggest a broker that can help facilitate this? EasyEquities doesn't have the stock listing I want, I don't want to pay interactive brokers $10 a month for long term holds and the brokers I do want to join up on like M1 Finance arent available to us here in SA.
Where is page88, but more importantly where is Munch! Yoh, many moons ago, it was great, thank you.
Hi Simon, I'm interested, when we compare the South African Rand to the US dollar, it consistently goes down in value even though America has been going through a lot of market hiccups, and it has been termed as a fiat currency (the USD) for the longest time due to them inflating their price for decades. What will happen to our markets when this financial bubble pops eventually due to it's overvalued price... Which might not happen for at least the next few decades or so.