Good morning, all

So it’s Wednesday. And I’ve spent this morning updating spreadsheets of portfolios. For the new readers, you can see the quick guide to this series of posts in The Investor Diaries: Week 22.

Where I’m going with today’s post:

  1. I’m going to start with the Once-Off Investor portfolios. Which, I’m realising, are really just a guide to what you should have done on 19 March 2014 with R3,500, if you had R3,500 – although there is some value in knowing in general which types of options for small investors are out there.
  2. Then I’m going to move on to the Monthly Investor portfolios. Which are much more useful – because they show that the real power of investment is the saving habit, and when compared to that, where you choose to put your money is much of a muchness. That is: you’re unlikely to make it big with a small portfolio of stocks. But you might just make it big if you’re a habitual investor.
  3. Finally, I’ll take a look at the SA economy.

The Once-Off Investors

Twenty three weeks in:

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In pictures:

Screen Shot 2014-08-27 at 7.54.17 AM

The Monthly Investors

It’s the last week of the month, so they would have just added another R1,000:

Screen Shot 2014-08-27 at 7.53.40 AM

In pictures:

Screen Shot 2014-08-27 at 7.58.11 AM

You’ll notice that the Naspers investor is having quite a ride… This is normally the point at which someone talks about the Power of Dollar Cost Averaging. Not quite sure whether it’s that, or “the power of the debit order”?

The Economy

Screen Shot 2014-08-27 at 7.53.59 AMThe good news: we’re “not in a recession”, because the GDP growth rate for the second quarter was positive (and a recession is generally defined as “two consecutive quarters of negative GDP growth”).

The bad news: well, we’re still worse off than we were in January. We lost 0.6%, and then we recovered by 0.6%. But the base changed, so 100*(1-0.6%)*(1+0.6%) < 100.

But obviously, that had a lot to do with the strikes. The stock market seemed entirely bored by the news:

Screen Shot 2014-08-27 at 7.53.17 AM


As was the exchange rate:

Screen Shot 2014-08-27 at 7.52.39 AMThe government bond yield, however, did react a bit positively (I know that the yield looks negative – but it only goes down when the bond price goes up, and people buy bonds when they’re feeling more positive, so it was actually a positive reaction):
Screen Shot 2014-08-27 at 7.52.49 AMOn the international commodity front, the price of crude oil continues to drop:
Screen Shot 2014-08-27 at 7.53.06 AMSo hopefully, a fall in the fuel price at some point. On a less happy note, the gold and platinum prices are also going down – which is a bit of bad news for our mining sector:Screen Shot 2014-08-27 at 7.52.58 AMIf you feel like something a bit more technical, I have recently become a fan of the SAfm Market Update with Moneyweb podcast. It’s on iTunes, but you can also find it here.

Until next week.