The Preamble

For the background to this series of posts: herehere and here. And the summary:

  1. Small investors have some investing options.
  2. You can invest occasionally in lump sums (the once-off investors) or monthly through debit orders (the monthly investors).
  3. As for things to invest in, I’m a general fan of low-cost equity-index-tracker ETFs (as is Warren Buffett). But there are other possibilities as well.
  4. This series of posts is there to see which would work out well.
  5. Then there are some indicators at the end. Because why not.

A look at the week everyone had:

Once-Off Investors

In numbers:

Week 35 Once Off Table

Could we all please take a moment to watch Naspers? And that wasn’t even the exciting part, because it’s missing the entire week’s drama. Here’s a graph for the last 5 trading days:

Naspers 5 day

And some commentary from my friend Hilary:

Watching the move in NaspersN was simply staggering. If you take the time to look at the chart it will become clearer: 

  • On Wednesday, Tencent  announced their Q3 figures and NaspersN fell from 142444 to 134010.
  • On Thursday it rallied to 144190 .
  • On Friday NaspersN announced a tie up with Schibsted and the shares surged to a high of 160397 and finally closed down to 155500.
  • Until Friday, the traders were selling Tencent and buying the rump. 
  • By mid-afternoon they started selling the rump and buying Tencent “nice trade if you can do it” terrifying for the rest of us!

Some trader talk translation:

  • You get listed companies that own shares in other listed companies. In this case, Naspers owns shares in Tencent – but the bigger global example right now is Yahoo owning a significant chunk of Alibaba.
  • This creates trading curiousness – because you have the Naspers and the Yahoo, which have value in themselves, and then you have their Big Listed Investments (the “Rump”), which also have value in themselves.
  • In theory, you expect those values to have something in common. For example, you shouldn’t have a situation where the value of Yahoo is less than the value of its Rump (ie. the value of its Alibaba stake). As happened a few weeks ago (see here).
  • In those situations, you would expect the market to buy up Yahoo shares (“buying the rump”) and sell off Alibaba shares, in order to get back to things making sense.
  • Something similar happened last week with Naspers.

In pictures:

Week 35 Once Off Graph

Monthly Investors

In numbers:

Week 35 Monthly Table

Clearly, Naspers is having a good week.

In pictures:

Week 35 Monthly Graph


What I wanted to say is, if you have a look at how things are going:

  1. Investing regularly in volatile investments looks like it makes a lot of sense.
  2. Some might call it the power of dollar-cost averaging.
  3. And the truth is: you do mitigate some of your risk by buying into a volatile stock at regular intervals.
  4. But that does not a sound investment strategy make.
  5. As I wrote about in this post: The Power of Dollar-Cost Averaging. Uh no.

The Indicators

Week 35 Indicators

The Exchange Rate is pulling back slightly:

Week 35 ZAR USD

The Stock Market is levelling off in Rand terms:

Week 35 ALSI

The Stock Market, in real terms, is looking up:

Week 35 Alsi USD

10 Year Government bonds:

Week 35 Govt Bond

Oil Prices continue to swallow-dive:

Week 35 Oil USD

Week 35 Oil ZAR

Gold and Platinum prices continue to do strange things:

Week 35 Gold Platinum USD

Week 35 Gold Platinum USD

Until next week!

Rolling Alpha posts opinions on finance, economics, and the corporate life in general. Follow me on Twitter @RollingAlpha, and on Facebook at