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If I had to start a JSE portfolio from scratch, here is how I would invest.

July 17, 2023
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Here is where I would put my personal money if I only started now.

 

Firstly, the biggest and most important rule:

JUST START!

You will learn lessons as you go, but investing is a great way to build long term wealth.

Lets get into it!

 

I WOULD INVEST MORE IN ETFs

ETFs outperform many fund managers over time, with extremely low fees and no effort or knowledge required.

I WOULD BUY THESE 2 EFTs:

1. Sygnia Itrix S&P 500 (SYG500)

2. FNB Global 1200 Equity Funds of Funds (FNBEQF)
 

I WOULD BUY 2-4 LARGE CAPS

1. Shoprite

2. MTN

Why these 2?

Well, I shop at Shoprite and I use MTNs service.

With investing, we need to invest in what we are able to understand.

Being a customer gives you first hand experience of the service.

Looking at a deeper level of research, these 2 businesses are really attractive for the long term in my opinion. Will share that on another day.
 

INDIVIDUAL STOCKS

I would invest in a few exciting companies for the long term. They carry slightly more risk, but also a chance to outperform the market. 

  • Transaction capital (SA Taxi, WeBuyCars)
  • Sabcap (Investment Holding Company)
  • Stadio (Exciting South African Education Play- Still very small)
  • Santova (Global Logistics and supply chain solutions- Still small, but growing very fast)
  • Capital appreciation (Small Cap Fintech Play)
  • Masterdrilling (Some Exposure to resources)
  • Renergen (Early stage Helium producer, lots if risk, but also lots of potential)
  • Prosus (Global holding company)


Investing in individual stocks require effort to do research on the companies and stay updates & informed. (Active investing)

Fortunately, the FinMeUp app assists you with this.

 

PORTFOLIO ALLOCATION

Here is how I would personally allocate my funds if I were to start from scratch.

  • SYG500 ETF = 25%
  • FNBEQF ETF = 25%
  • Shoprite 7.5%
  • MTN 7.5%
  • Transaction Capital 5%
  • Santova 5%
  • Stadio 5%
  • Sabcap 5%
  • Capital Appreciation 5%
  • Renergen 5%
  • Prosus 5%
     

In my opinion, this allocation has a nice spread between low rish and high risk.

Would I stop here?

NO!

Investing is a long term consistant and continuous game.

So, I would put a monthly recurring deposit order, or even do it manually. 

What I invest in will change each month, because each month there will be new opportunities.

So I would  make a watchlist of companies to track or add to my existing investments.

For example, a few companies on my watchlist currently are:

African Rainbow Capital, Cartrack, Alviva Holdings, Advtech, Kaap Agri etc
 

Final Note

Markets go up & down.

Quality investments go up in the long term.

Investing requires you to stay in control of your emotions. (Once again why ETFs are a great option)

There is NO SECRET FORMULA. We all learn as we go, but in order to learn, we must start.

 

Disclaimer: This is not financial advice. This is only for educational and informational purposes. Always do your own due diligence when managing your own finances.)


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