HOW TO ACTUALLY START INVESTING

Terminology embedded within the investment industry usually tends to scare many people off. Or maybe a Steinhoff scenario, leading to the fear of losing everything.

Wealth creation is not the most difficult things to do, but to spend the time with it is what makes it difficult. How about this, if those who lost all or most of their money with the Steinhoff crash had merely diversified their portfolio, the pain would have been much less daunting to their overall wealth.

How can I effectively diversify my portfolio?

Let’s start with an example. If you have a portfolio of 20 different companies, evenly distributed, and one of those companies is Steinhoff, then a total collapse of the company would not have cost you your whole portfolio but only a mere 5% of your portfolio.

With the emergence of ETFs, diversification has been revolutionized. You can now essentially buy a basket of 40 companies (SATRIX 40) in one single purchase. What’s revolutionary about it is that you don’t need to have the fear of losing everything and the best part, it is a lot cheaper than having to buy the 40 different companies individually.

You can now not only diversify your portfolio across different asset classes but also around the globe as ETFs are domestically listed securities. These ETFs come at an extremely low cost as they already consist of more than 100 companies within the ETF. Buying all of those shares individually will come at a substantial cost compared to adding ETFs to your portfolio.

How do I create wealth?

The first thing to do is to accept that wealth creation is not an overnight process. It is not rocket science but it is also not an easy process. If you make use of efficient risk management and money management, then you should have a considerable amount of wealth at the end of the day.

Short term fluctuations within ETFs are not uncommon, but over time businesses (those contained in the various ETFs) tend to perform better than most other asset classes. As companies perform, they reinvest some of those earnings to aid the company’s future growth. Now, make a basket of various companies and you will find a well-balanced wealth-generating portfolio.

Getting started is simple, visit our website at www.caveat.co.za for more information. Alternatively, find our contact details below to speak to one of our representatives.

Who are we?

Caveat Capital Management is a strategic advisory firm based in Cape Town. Caveat Capital Management specializes in structuring tailor-made investment portfolios that serve your needs now and grow with you as your needs change. Caveat works to maximize your gains and minimize the risk.

What we offer

Caveat Capital Management has a competitive fee structure that incentivizes the portfolio manager to perform and the renumeration is highly linked to the performance of the portfolio. Caveat Capital MGMT (Pty) Ltd is a CATII – Authorized Financial Services Provider (FSP no. 24777) registered at the South African Financial Services Conduct Authority (FSCA). Meaning that we have the required licensing to structure full-discretionary portfolios structured to your needs.

Disclaimer

This report does not guarantee the suitability or potential value of any information or particular investment source. The information provided is not intended to, nor does it constitute financial, tax, legal, investment or other advice. Before making any decision or taking any action regarding your finances, you should consult a qualified financial adviser. Nothing contained in this publication constitutes a solicitation, recommendation, endorsement or offer by Caveat Capital Management, but is merely an invitation to do business.

Information and content

The information in and content of this publication are provided by Caveat Capital Management as general information about the company and its products and services. Caveat Capital Management does not guarantee the suitability or potential value of any information or particular investment source. The information provided is not intended to, nor does it constitute financial, tax, legal, investment or other advice. Before making any decision or taking any action regarding your finances, you should consult a qualified financial adviser. Nothing contained in this publication constitutes a solicitation, recommendation, endorsement or offer by Caveat Capital Management, but is merely an invitation to do business.

Caveat Capital Management has taken and will continue to take care that all information provided, in so far as this is under its control, is true and correct. However, Caveat Capital Management shall not be responsible for and therefore disclaims any liability for any loss, liability, damage (whether direct or consequential) or expense of any nature whatsoever which may be suffered as a result of or which may be attributable, directly or indirectly, to the use of or reliance upon any information provided. Past performance is not an indication of future performance. Caveat Capital Management does not provide any guarantee regarding capital or performance.

Caveat Capital MGMT (Pty) Ltd is a CATII – Authorized Financial Services Provider (FSP no. 24777) registered at the South African Financial Services Conduct Authority (FSCA).