Some years ago I invested my extra cash in some high yield investment plans. Needless many of them failed. In my opinion two of them were forced to fail because they became a too big thread to the big banks and in South Africa the banks’ monopoly are protected by the bank law.

So after loosing close to a million in some of these ventures I decided to look for a more secure option. I’ve been investing with Satrix for about 2 years now and my returns are very good. Satrix is wonderful because their fees are very low, almost nothing compared to unit trust and even direct share investments. With Satrix you do not need a broker, you can register directly and you can even do it online.

You can find them at http://www.satrix.co.za/

I pasted the contents of this month’s Satrix newsletter below:

SATRIX INVESTMENT PLAN CLIENT LETTER – APRIL 2011
EVENTS OF Q1 2011
The first quarter of 2011 was an eventful and volatile period, with the popular uprisings in North Africa and the Middle
East and the deadly earthquake and tsunami that battered Japan. When events like this occur, they inevitably have a
negative impact on the investment markets and the global economy. Despite the aforesaid impact, over the one year
period to 31 March 2011 the JSE All Share Index (ALSI), commonly referred to as “the market”, produced a 15% return
in Rand terms. Over five years to 31 March 2011 the ALSI delivered a solid 81%. From its daily low of 18,121 during
the midst of the financial crisis in March 2009, the ALSI found its way back up to a level of 32 204 on 31 March 2011.
This level is close to the ALSI’s all time high in May 2008 of 32 959. Read more »

There is huge debate on Passive vs Active managed share portfolios.

While the general tren of a share might be upwards, it has the uos and downs along the way.

The Passive trader buys shares and leave it to ride the wave. The active trader tries to predict when the price will go up or when it will go down and then “Buy low and sell hig” There are people making millions selling your software which they claim can predict on your behalf when the price will be high or low.

Besides the risk of making the wrong prediction and buying or selling at the wrong time, another huge disadvantage of an active managed fund is the high cost.

With a Passive managed fund the cost is often much lower. In South Africa we have the Satrix Fund which is a Passive managed fund and the cost of this fund is very low.

I paste an excerpt of the last newsletter I received from them which explains more about Passive and Active managed funds:

LOOK MOM, NO ACTIVE MANAGEMENT…

To many investors passive investing implies average returns. An index that is a proxy for the market will deliver the
average return of the market. However, the majority of active managers underperform the market after costs so getting
the market average is in fact above average performance. Secondly, not all indices are equal; some indices are
designed to outperform the market or sector of the market… Read more »

Many people would love to get involved in property investments, but they have all kinds of excuses not to do so. I received this article today and it is so true. Read it and you will see there is no reason not to get involved in property investments if you do it the right way.

The 8 excuses most novice buy-to-let property investors use when they do not succeed in property investing. You will find that most excuses are more emotional than business related.

1. I have no time

The Excuse:

Part time buy-to-let property investing takes too much of my family time.

The Truth:

Time management is in your emotional control and has more to do with your priorities and relationships in life. Most people are spending too much time on low priority actions such as watching TV and too little time working on their business and relationships.

The Cure:

Cut down on watching TV and creatively use your time to build your professional buy-to-let property investment business power team. You are just as strong as your power team.

2. I have no money

Read more »

When investing in funds many people do not take the effect of fees in concideration. They tend to think that 2% per annum is the norm and it is just one of those things, it is something you have to pay.

Here is an exerpt from a Fin24 article which indicates what difference the 2% per annum fee can make to your investment.

Johannesburg – Investors who think one or two percent in fees does not make much difference are deluding themselves, says Kari van Rensburg, a director of Sandton-based Deutsche Securities.

The company demonstrated the point by studying net returns achieved by the JSE’s All Share Index (Alsi) over the 20 years to May 2009, and says the pattern of value depletion holds true for all investments where fees are charged as a percentage of assets under management. Read more »

I have seen many people getting burned during the past couple of years because if the wrong advice on real estate investment’s.

I think this is because of all the hype about real estate investments in South Africa at the moment. There are some people marketing real estate courses that let it sound as if anybody can invest in real estate and make millions.

The true fact is that a lot of things have changed over the past 2 years. South Africa experienced a property boom. At the start of this boom we made good money. We could sign an offer on a new development and easily make R100,000 or more by the time it building has been completed. But all these new properties created another problem; At the moment there are an over supply of rental properties in some areas. What this means to the potential real estate investor is that your rental income will be very low because the tenants can choose where they would like to stay. They can bargain for a price because most real estate investors would rather except a lower rent than let his property stand empty.

Read more »

Using Real Estate and Network Marketing to create wealth

Most of us are aware of the many advantages of building a passive income via Network Marketing. Robert Kiyosaki mentions the advantages of Network Marketing in his books “Rich Dad Poor Dad” and  ”Rich Dad’s guide to Investing“. He also suggests that people who are serious about achieving success join a Network Marketing business in order to learn some people skills and learn how to sell.

Although you can earn thousands of rand’s with Network Marketing, it is not this monthly passive income that will Read more »