GEORGE BUSINESS NEWS - Allan Gray is satisfied that its investor funds managed to beat inflation and their benchmarks over the past three years in a market that essentially showed no growth.
Speaking at the company's annual investment update last week at Oubaai Hotel, Portfolio Manager Leonard Kruger said this was the result of their strategy of avoiding financial herding. Instead, they looked for individual investment opportunities through doing their own research on companies and forming their own opinions on what to do. As a result, investments were less likely to be affected by the sways of the markets in reaction to political turmoil.
Giving an update on offshore investments, Orbis Investment Advisor Tamryn Lamb said that a weak rand must not dissuade investors from investing offshore. South Africa makes up less than 1% of the global economy and less than 4% of emerging markets, so having foreign exposure is vital to strengthen your portfolio over the long term. Added to this must be a strategy of investing through the good and the bad years to ensure returns.
Lamb said the Global Orbis Equity Fund outperformed its benchmark and the boarder markets over the past year. The fund gives a widely diversified exposure in businesses that have all been individually investigated by 42 investment analysts globally. In the last year, they scrutinised 440 companies, of which only seven made it into the Orbis fund.
Jeanette Marais, client services director, talked about the effect that investors' behaviour has on their retirement savings. It is one of the critical factors that can make the difference between a comfortable retirement and a meagre retirement. She said investors dipping into their investments or switching funds when they are driven by fear during a downturn, are two of the biggest factors that destroy earnings and reduce the eventual value of their retirement savings.
If you want to retire with an annual salary equal to 75% of your last annual salary, you need to put away an amount equal to 17 times your last annual salary. Being debt-free and not having dependents at that stage in life are pluses if you aim not to drop your standard of life significantly. To achieve adequate savings, start early, never dip into savings, and ensure that you earn real returns on your investments (that is, do not invest in cash).
If possible, work for a further five years after retirement age. It will give your savings a significant boost due to compound growth.
ARTICLE & PHOTOS: ALIDA DE BEER, GEORGE HERALD JOURNALIST
