Getting into the Game
For many would-be investors the first step into the scary world of investments is often one that is too big to take. Too often these are the investors who are sitting on the sidelines when they read about the fantastic success stories of Capitec, PSG, Grindrod, Pinnacle Technology Holdings or even the double digit annualised returns from the likes of the Satrix40. The question of how to take the first step and get into the investment game is an important one for many young South Africans.
Almo Lubowski from the Financial Planning Institute says step number one is to shuck off apathy and make sure that you are prepared to do some of the legwork that will help you make informed decisions. “As an adviser it’s difficult to help people when they aren’t even willing to help themselves,” he told Finweek.
So what is step number one when you have decided you want to start?
“I believe in some form of focus. Decide what kind of things you would like to invest in and what the purpose is,” says Lubowski. He adds: “Whatever it may be, just choose something. Do your own research and then speak to some experts in that field as well, but not before you have done some of your own searching.”
Does it matter what that investment is?
“There’s something exciting about all of them. What scares people is the lack of knowledge. The financial world can be confusing, but finding out things step by step, with some professional help, makes it less scary. Start somewhere and don’t let the mountain ahead put you off,” says Lubowski.
Shaun le Roux from PSG Asset Management had some heartening words for newbie investors in his monthly newsletter to investors. He told clients: “In life, the good thing about making mistakes is that you get a chance to learn from them. In investment markets they’re an invaluable part of trying to become better at what you do.”
Le Roux has a simple view on what makes up an investment process: “An investment process is all about putting together a method of identifying good potential investments – where the odds of success are more likely to be in your favour than not – and effectively allocating capital to those investments after considering the likelihood of your being wrong.”
Some easy tools to get you into the share investing game:
• Check out the websites of leading asset managers such as Coronation, Investec Asset Management, PSG, Stanlib, Sanlam and Marriott to find out what funds they offer and how much it costs to invest.
• Approach local stockbrokerages which have a strong emphasis on retail investor education such as Global Trader, Standard Bank and Sanlam iTrade to find out what courses are available, and whether they offer the opportunity to assist you in making your first trade. �
• Visit websites such as http://www.fintalk.co.za/ or http://www.justonelap.com/ to find more information on different aspects involved in investing.
For those still worried about taking the leap, perhaps consider some advice from John Powell: “The only real mistake is the one from which we learn nothing.”
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Story by Marc Ashton
