JSE Investing

[Craai]

Capitecs customer base will be hit hard - as will we all, but theirs especially relative to other banks. First to be fired, last to be rehired.

 

I cannot see a situation where their bad debts don't become out of control. 

 

I hope I'm wrong, its a super slick operation, but I'm very weary of this one.

 

African Bank V 2.0 (Although not half as dodgy)

[Carmichael]

Jip think Capitec is in a world of hurt,and hurting PSG as well. So now, what do they do? Does PSG keep Curro or drop Curro and invest in Capitec? 

[mon-goose]

my pension is down 20% in the last week

[sawystertrance]

Can anybody explain to me why the Gold mines are down? Is it related to gearing?

[Chris_]

Can anybody explain to me why the Gold mines are down? Is it related to gearing?

 

We saw the USD gold price get smoked over the last while. Theres no such thing as a safe haven when selling is this panicked. Selling becomes across all sectors and into cash regardless. I think a lot of the decline was this.

 

The ZAR gold price has obviously held up better, it did though still take a small knock, but I think a lot more of our mines are reporting in USD so this doens't help as much anymore.

 

I think it also comes down to production. Mines cannot continue to operate as usual with the human movement restrictions coming in.

 

I'm largely invested in gold now and have also been scratching my head. Theres a baby bounce this morning which helps the nerves a little...

 

edit: i don't have gearing or in-depth info anymore so you may well be right.

Edited March 20, 2020 by CBlake

[Chris_]

Another reason which people will struggle to find info on, or none at all - is derivatives. There are a lot of protection strategies out there, so when things get moving like we've just had, theres a world of exponential pain in the background compounding the moves.

[sawystertrance]

I still don't get it and thought gold was always a safe refuge, especially in times of panic.

 

Only fact I have is that Sibanye has a revolving credit facility of, I think, R7.5 Bn. So perhaps with the Rand tanked it is a bigger load to bear..

 

I did find this:

"Traders were “exiting everything which is giving them profit,” said Chintan Karnani, chief market analyst at Insignia Consultants, with a technical selloff triggered when gold fell below $1,500."

 

And this:

 

https://www.marketwatch.com/story/why-golds-plunge-proves-its-a-safe-haven-asset-2020-03-12?mod=article_inline

 

But generally you are correct - there was a flight to cash.

[bertusras]

My personal investments (all with Allan Gray through various funds) are down about 7.5% since the beginning of the month, which doesn't seem too bad, but it's a lot of actual value gone almost overnight.

 

My pension and preservation funds at Discovery however are down about 20% on the contributed amounts. Which is scary.

[sawystertrance]

My AG Orbis fund is down, I think, about 17%. Ouch.

[Chris_]

I still don't get it and thought gold was always a safe refuge, especially in times of panic.

 

Only fact I have is that Sibanye has a revolving credit facility of, I think, R7.5 Bn. So perhaps with the Rand tanked it is a bigger load to bear..

 

I did find this:

"Traders were “exiting everything which is giving them profit,” said Chintan Karnani, chief market analyst at Insignia Consultants, with a technical selloff triggered when gold fell below $1,500."

 

And this:

 

https://www.marketwatch.com/story/why-golds-plunge-proves-its-a-safe-haven-asset-2020-03-12?mod=article_inline

 

But generally you are correct - there was a flight to cash.

 

Ja, similar to that article; one of the things I read about why gold first started falling was people selling it to fund their other losing positions.

[Captain Fastbastard Mayhem]

My personal investments (all with Allan Gray through various funds) are down about 7.5% since the beginning of the month, which doesn't seem too bad, but it's a lot of actual value gone almost overnight.

 

My pension and preservation funds at Discovery however are down about 20% on the contributed amounts. Which is scary.

Yeah, and there's nothing we can do about it at the moment. Selling now would be suicide!

 

Only way out is with clever decisions, there are a couple of funds which are positioned well for this (those funds that have flexible mandates and can switch their entire holding to cash) and that's what we're looking for at the moment. 

 

And then of course the trading of shares as well. I don't do that, though... 

Edited March 20, 2020 by Captain Fastbastard Mayhem

[sawystertrance]

"can switch their entire portfolio to cash".

 

Doesn't that trigger a CGT event?

[Captain Fastbastard Mayhem]

"can switch their entire portfolio to cash".

 

Doesn't that trigger a CGT event?

No, because it's still within the fund, which has it's own unit price based on the collection of stocks it has inside it. You're buying the unit, and the difference in the price of the units is what you pay CGT on, if you withdraw from that fund.

 

If you'd personally switched from an equity fund (or any fund) to another fund, then there's a CGT event, as you've triggered a sale or switch between 2 different funds. 

 

Important note: This was a fund (unit trust) that has a flexible mandate, IE they can invest any % of their funds in any sector, and aren't tied by a fixed mandate, like, say, an Equity Fund or a Bond fund. With unit trusts, the manager can decide to disinvest from one co and invest in another, and it doesn't affect you because it's all happening within the unit trust itself, and won't affect the underlying unit price. 

Edited March 20, 2020 by Captain Fastbastard Mayhem

[River Rat]

At the start of the year I had some free cash (Euros) that I needed to invest into the market. My foreign investment strategy is relatively simple I look for ETFs that give me a dividend yield of 3% and above. Why ETFs as opposed to ordinary shares? I find that my news feed on companies in the US, Far East and Europe to be either delayed or sometimes very patchy, so it is difficult to monitor these and an ETF gives me an inherent spread in terms of risk. I have been sitting on the cash for somettime now earning no interest but I was waiting for a dip to previous support levels because the market was too rich for my blood and not meeting my hurdle rate of return.

 

So 2 weeks ago I put orders in on three different ETFs at levels that would give me the minimum dividend yield. By Monday last week I was fully invested as the first crash hit us, by Wednesday I was in the money as the market went up again but the volatility was massive so I shorted my shares. I couldn't find a direct short for the specific ETFs so I took shorts on the DOW, the DAX and Shanghai as proxies for my investment spread. As things stand I have an unrealized profit on the shorts but an unrealized loss on my ETFs, on aggregate I am in the black. This shows that the Beta of my ETFs are lower than the markets I have invested in which is another plus.

 

This strategy has worked in this instance and my only decision to make is when to take profit on my short trades. However, my local share portfolio has been reduced to mostly cash as my 10% stop losses kicked in so there's a question about when to reenter the market. Unfortunately my RAs are down roughly 20%. I have been trading on the stock market for over 20 years with well honed strategies that work for me but I am not so sure they're applicable in this market so for what it's worth I would be very cautious about doing anything rash right now. I am sitting on my hands.

[Prince]

In these markets the smart traders make millions by shorting shares. How does SASOL drop to R24 then two hours later is at R46?

Edited March 20, 2020 by Prince

[bertusras]

Yeah at the moment you just have to ride out the storm. I trust that the fund managers know more than I do, and a 7.5% drop in the current situation is actually not too bad.

 

When you're looking at companies like Atterbury (ATT) having lost 40% in the last month, Redefine (RDF) down 60%, things aren't too bad for me personally at this stage.