Wednesday, 22 February 2012 - 20:00
Charts
Retirement Funds ? Thinking Outside the Box I want to start this newsletter with a riddle:
“Mr Jones drives in his two seated sports car on a stormy, rainy day. He notices three people standing beside the road, Jerry, his very good friend for years, an old lady that needs to go to the hospital, and a beautiful blonde woman. What should he do?”
(The answer is shown at the end of the newsletter)
It is very interesting to talk to private clients and their understanding regarding their retirement fund. Most of the time members of retirement funds don’t understand their benefits and how to maximize them.
So where is the problem?
There are so many stakeholders involved in a retirement fund but ultimately all the stakeholders should be there for the benefit of the members of fund. However, very often that is not the case.
The old retirement funds (i.e. Defined Benefit funds) were quite easy to understand from a member’s point of view. The only thing a member had to do was to work at the same company for 30 to 40 years to secure pension of about 70% of his/her salary at retirement.
The new generation retirement funds (i.e. Defined Contribution funds) are also easy to understand but complicated to manage. It is easy to understand because each member is building his/her own portfolio of assets. It is difficult to manage because members need to make sure that they:
- Contribute enough for retirement,
- Invest in the correct portfolio to ensure retirement, and
- Work long enough to ensure the value of the fund is large enough to finance an ongoing pension for the
next say 30 years after retirement.
My experience shows that members of these new generation retirement funds don’t understand their benefits and risks because it hasn’t been adequately explained by the stakeholders. The stakeholders are the investment consultant to the trustees, the asset manager of the retirement fund, the broker consultant to the fund and the broker consultant to the member.
If the stakeholders can come together and jointly provide a holistic service to the trustees and ultimately the members, then each member of a retirement fund should be able to answer the following basic questions:
- How much do I need to contribute to ensure a comfortable retirement?
- What type of portfolio do I need to invest in to ensure a comfortable retirement?
- How much capital do I need at retirement to be able to retire comfortably?
- How much life cover do I have?
- How much disability cover do I have?
If one can’t answer the questions above then one should probably ask the question whether the stakeholders are really doing their job.
To be able to address the needs of the members of retirement funds the stakeholders will need to think outside the box.
Kind regards,
Vincent Heys
info@seedinvestments.co.za
www.seedinvestments.co.za
PS: The answer to the “outside the box” riddle is:
“Mr Jones gives his car to his friend Jerry to take the old lady to the hospital so that he can stay behind with the beautiful blonde woman.”
Wed, 22 Feb 2012
Top News
South Africa-based Econet Wireless is seeking at least $3.1 billion in damages from Bharti Airtel in a dispute over ownership of Airtel Nigeria, according to a suit Econet said it had filed on Wednesday. Full story
South African stocks edged down half a percent on Wednesday, as shares of Impala Platinum fell after the miner said its April deliveries would be cut in half by a strike at its main mine. Full story |
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World stocks edged lower
on Wednesday after data showing the euro zone may be
sliding back toward recession and signs the region's crisis may
be hitting China's giant economy. Full storyAfghan President Hamid Karzai appealed for calm on Wednesday after officials said six people were shot dead and dozens wounded in protests over the burning of copies of the Koran, Islam's holy book, at NATO's main base in the country. Full storySyrian President Bashar al-Assad's forces rained rockets and bombs down on opposition-held neighbourhoods of the city of Homs Wednesday, reducing buildings to rubble and killing more than 80 people, including two Western journalists. Full story |
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Markets | U.S. stocks fell
on Wednesday with the S&P 500 stalled near a
10-month-old high after weak data on Europe's business activity
raised concerns. . . Full story | | Gold eased on
Wednesday, declining after Tuesday's rally as a rise in the
dollar, worries over a euro zone recession and doubts over. . . Full story | | Britain's leading share
index edged lower on Wednesday as investors refocused on
fundamentals, specifically weaker-than-expected euro zone data,
with the Greek debt restructuring theatricals. . . Full story | | European shares fell in
low-volume on Wednesday for the second consecutive session as
euro zone purchasing managers data suggested the region could
tip into. . . Full story |
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| U.S. stocks opened
slightly lower on Wednesday, putting the S&P 500's
three-day winning streak in jeopardy after weaker-than-expected
euro zone economic data.. . . Full story | | European stocks fell on
Wednesday as weaker than expected economic data prompted
investors to cash in recent profits, although the rising
trendlines of benchmark. . . Full story | | European shares were flat
in early trade on Wednesday, after upbeat manufacturing data
from China and France was offset by continued worries over
Greece's. . . Full story | | Hong Kong shares
reversed early losses to end higher for a second straight
session on Wednesday, with Chinese developers outweighing
weakness in Li &. . . Full story |
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SA Business | | | South Africa projected a lower-than-expected 2012/13 budget deficit on Wednesday, reassuring bond investors and ratings agencies that the continent's biggest economy. . . Full story | | Impala Platinum, the world's second-largest platinum producer, has warned customers that its April platinum deliveries would be down about 50 percent. . . Full story | | South African retailer Massmart sees scope for up to 20 stores in Nigeria, its chief executive said, the second business leader. . . Full story |
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| Zambia's economic growth with hold up well this year and next as cashes in on high copper prices through privatisation, bringing. . . Full story | | South Africa's government bonds weakened on Wednesday, reversing gains that were prompted by the finance ministry's narrower-than-expected budget deficit forecasts as. . . Full story | | South Africa will introduce two new fixed income and three inflation-linked bonds in 2012/13 to smooth the maturity structure of its. . . Full story | | South Africa cut its 2012 economic growth forecast to 2.7 percent on Wednesday from an October projection of 3.4 percent, reflecting. . . Full story |
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| South Africa is looking to introduce a carbon tax next year to reduce harmful greenhouse gas emissions, although nearly two-thirds of emissions will be tax-exempt until 2020 to lessen the impact on industry, the treasury said on Wednesday.. . . Full story | | Standard Bank, Africa largest bank by assets, signed an agreement with Japan's Mizuho Financial Group on corporate lending in Africa, Standard Bank said on Wednesday, confirming an earlier Reuters report.. . . Full story |
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Company News | Steinhoff shareholders are advised that the headline earnings per share ("HEPS") and earnings per share ("EPS") of Steinhoff for the six. . . Full story | | Shareholders are referred to the announcement released on SENS on 21 December 2011 and the mandatory offer document posted on. . . Full story | | The board of directors of PSV ("the Board") is pleased to advise shareholders that PSV has entered into a Sale of. . . Full story | | Optimum informed shareholders that the acquisition of the TNC Prospecting Rights from Umcebo Mining (Pty) Ltd has been concluded and the. . . Full story |
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| The board of directors of PSV ("the Board") is pleased to advise shareholders that PSV has entered into a Sale of. . . Full story | | Further to the trading statement released on SENS on 3 February 2012, a review of the financial results for the six. . . Full story | | Old Mutual announces that a preliminary non-binding offer has been accepted by Ecobank Transnational Inc (ETI) for the acquisition of Oceanic. . . Full story | | Business Day reported that the battle for market share among South African food retailers was in full swing, with the Whitey. . . Full story |
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Company Results | Revenue increased to R1.3 billion (R1.2 billion). EBITDA amounted to R78.2 million (loss of R331.3 million) and an operating profit of. . . Full story | | Revenue for the year ended 31 December 2011 increased by 16% to R13.4 billion (2010: R11.6 billion). Profit from operations surged. . . Full story | | Revenue increased to R4 billion (R3.6 billion) and operating profit rose to R455 million (R404 million). Profit attributable to owners of. . . Full story | | Revenue for the interim period ended 31 December 2011 increased to R400.5 million (2010: R322.4 million). Operating profit for the period. . . Full story |
World Markets (Spot Prices)
Name | Time | RP | Move | % Move | JSE Overall | 17:00 | 34006.52 | -135.85 | -0.40% | JSE Top 40 | 17:00 | 30288.89 | -149.45 | -0.49% | JSE Gold | 17:00 | 2812.93 | 9.20 | 0.33% | JSE Financial | 17:00 | 24040.10 | -209.78 | -0.87% | JSE Industrial | 17:00 | 36409.07 | -32.76 | -0.09% | JSE Indust 25 | 17:00 | 30507.85 | -63.87 | -0.21% | JSE Resource | 17:00 | 54111.62 | -307.17 | -0.56% | DJ Futures | 19:46 | 12900.00 | -45.00 | -0.35% | DJ Ind | 19:45 | 12930.91 | -34.78 | -0.27% | SP 500 | 20:00 | 1357.39 | -4.82 | -0.35% | Nasdaq | 20:00 | 2932.88 | -15.69 | -0.53% | FTSE 100 | 18:35 | 5916.55 | -11.65 | -0.20% | DAX | 19:06 | 6843.87 | -64.31 | -0.93% | CAC40 | 19:06 | 3447.37 | -17.87 | -0.52% | Nikkei | 08:26 | 9554.00 | 90.98 | 0.96% | Shanghai | 09:26 | 2403.59 | 22.16 | 0.93% | Hang-Seng | 10:26 | 21549.28 | 70.56 | 0.33% | All Ords | 07:44 | 4372.10 | 3.90 | 0.09% | NZSE 50 | 06:46 | 3328.23 | -9.09 | -0.27% |
| | Name | Time | RP | Move | % Move | Gold | 19:59 | 1757.23 | -1.45 | -0.08% | Gold/Rand | 20:00 | 13587.25 | -20.30 | -0.15% | Gold/R kg | 20:00 | 436830 | 2154 | 0.50% | Silver | 19:59 | 34.0950 | -.2600 | -0.76% | Platinum | 19:59 | 1714.50 | 28.50 | 1.69% | Palladium | 19:59 | 715.50 | 9.60 | 1.36% | R157 | 16:06 | 6.62 | .01 | 0.15% | R204 | 16:06 | 7.50 | .02 | 0.27% | Brent Crude | 19:56 | 123.46 | 1.81 | 1.49% | Rand / Dollar | 19:59 | 7.7322 | -0.0042 | -0.05% | Rand / Pound | 19:55 | 12.0817 | -0.0960 | -0.79% | Rand / Euro | 19:55 | 10.2457 | 0.0087 | 0.08% | Rand / NZD | 19:58 | 6.4071 | -0.0394 | -0.61% | Rand / AUD | 19:55 | 8.2193 | -0.0225 | -0.27% | Yen / Dollar | 19:59 | 80.3560 | 0.6190 | 0.78% | Euro / Dollar | 19:55 | 0.7543 | -0.0012 | -0.16% | Dollar / Euro | 19:59 | 1.3246 | 0.0018 | 0.13% | Pound / Dollar | 19:55 | 0.6379 | 0.0045 | 0.71% |
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Click here for the Sharenet Spot Price page
The JSE Today
Trading Statistics
Date | Adv. | Decl. | Unch. | Actives | Volume | Value | Trades | Orders |
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22/02/2012 | 140 | 186 | 87 | 413 | 260,627,284 | R13,323,663,639 | 93501 | 1923969 | 21/02/2012 | 164 | 155 | 81 | 400 | 250,963,560 | R12,117,791,523 | 74201 | 2133714 | 20/02/2012 | 180 | 144 | 85 | 409 | 195,412,533 | R8,972,011,057 | 65519 | 1867969 | 17/02/2012 | 244 | 99 | 82 | 425 | 247,100,254 | R11,957,838,675 | 92849 | 2155145 | 16/02/2012 | 124 | 238 | 75 | 437 | 249,958,244 | R15,415,618,974 | 109642 | 2521337 |
* Includes all listed instruments on the JSE
Index Summary Index Name | RP | Move | % Move | Top 40 | 30,288.89 | -149.45 | -0.49% | Industrial | 36,409.07 | -32.76 | -0.09% | Mid Cap | 46,508.46 | 29.70 | 0.06% | Small Cap | 34,973.00 | 39.81 | 0.11% | Resource 20 | 54,111.62 | -307.17 | -0.56% | Industrial 25 | 30,507.85 | -63.87 | -0.21% | Financial 15 | 9,097.37 | -87.95 | -0.96% | Financial & Ind. 30 | 34,019.95 | -161.30 | -0.47% | All Share | 34,006.52 | -135.85 | -0.40% | Oil & Gas | 30,345.50 | 37.84 | 0.12% | Mining | 34,885.73 | -221.90 | -0.63% | Gold Mining | 2,812.93 | 9.20 | 0.33% | Platinum Mining | 61.34 | -.33 | -0.54% | GENERAL MINING | 8,752.78 | -86.00 | -0.97% | Oil & Gas Producers | 16,316.21 | 20.34 | 0.12% | Basic Materials | 29,650.06 | -159.63 | -0.54% | Chemicals | 15,033.41 | 32.85 | 0.22% | Forestry & Paper | 13,613.25 | 180.75 | 1.35% | Industrial Metals | 31,323.30 | 3.98 | 0.01% | Industrials | 31,226.51 | -89.30 | -0.29% | General Industrials | 86,563.25 | -934.57 | -1.07% | Consumer Goods | 31,457.66 | -34.62 | -0.11% | Automobiles & Parts | 4,925.20 | 11.33 | 0.23% | Household Goods | 166.09 | -1 | -0.55% | Health Care | 37,786.62 | -200.90 | -0.53% | Beverages | 105.22 | .31 | 0.30% |
| | Index Name | RP | Move | % Move | Food Producers | 56,414.12 | -164.13 | -0.29% | Personal Goods | 459.43 | -2.00 | -0.43% | Consumer Services | 61,886.64 | 84.66 | 0.14% | General Retailers | 52,012.61 | 285.98 | 0.55% | Travel & Leisure | 3,727.70 | 9.18 | 0.25% | Media | 88.54 | .00 | 0.00% | Support Services | 2,362.64 | 13.43 | 0.57% | Telecommunications | 66,585.92 | -227.70 | -0.34% | Financials | 24,040.10 | -209.78 | -0.87% | Banks | 45,090.43 | -464.11 | -1.02% | Non-life Insurance | 36,252.39 | 92.14 | 0.25% | Life Insurance | 19,284.89 | -158.01 | -0.81% | General Financial | 2,299.83 | -18.18 | -0.78% | Technology | 26,769.52 | 125.15 | 0.47% | SHARIAH TOP40 | 3,199.54 | -16 | -0.48% | FTSE/JSE SHARIAH ALL | 3,284.47 | -13 | -0.40% | COAL MINING | 27,445.89 | 667 | 2.49% | FTSE JSE Fledgling | 5,227.87 | 17 | 0.32% | FTSE/JSE Alt X | 1,249.86 | 13 | 1.06% | SA LISTED PROPERTY | 408.18 | | -0.32% | CAPPED PROPERTY | 331.10 | | -0.65% | RESOURCE | 29,893.01 | -156 | -0.52% | DIVIDEND PLUS | 193.51 | 1 | 0.32% | FTSE/JSE RAFI 40 | 7,096.14 | -41 | -0.58% | Capped Top 40 | 15,947.89 | -76 | -0.47% | Capped All Share | 17,191.65 | -68 | -0.39% | JSE TABACO | 4,826.98 | -29 | -0.59% |
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Click here for the Sharenet Index Summary page
Latest Consensus Changes** Code | Company Name | Status | Updated | CPL | CAPITAL PROPERTY FUND | BUY | 17 Feb | REM | REMGRO LIMITED | BUY | 17 Feb | IMP | IMPALA PLATINUM HOLDINGS ... | BUY | 17 Feb | AGL | ANGLO AMERICAN PLC | BUY | 16 Feb | EMI | EMIRA PROPERTY FUND | BUY | 16 Feb |
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Results Expected** Expected | Company Name | Fin. Date | 23 Feb 2012 | ACCENT | December 2011 (Interim) | 23 Feb 2012 | AFROX | December 2011 (Final) | 23 Feb 2012 | BLACKSTAR | December 2011 (Final) | 23 Feb 2012 | CAPSHOP | December 2011 (Final) | 23 Feb 2012 | CBH | December 2011 (Interim) |
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Recent Dividends** Share Name | Dec-Date | LDT | Pay-Date | Amount | ONELOGIX | 12-02-20 | 12-03-15 | 12-03-26 | R 0.0180 | ONELOGIX | 12-02-20 | 12-03-15 | 12-03-26 | R 0.0270 | WBHO | 12-02-20 | 12-04-04 | 12-04-16 | R 1.1000 | CAPEVIN | 12-02-17 | 12-03-09 | 12-03-19 | R 1.9840 | GFIELDS | 12-02-17 | 12-03-02 | 12-03-12 | R 2.3000 |
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Ex Div** Share Name | Dec-Date | LDT | Pay-Date | Amount | FIRSTRANDB-P | 12-02-03 | 12-02-17 | 12-02-27 | R 3.0516 | CAPITAL | 12-02-01 | 12-02-17 | 12-02-27 | R 0.3427 | CULINAN5.5 | 12-02-03 | 12-02-17 | 12-02-27 | R 0.0550 |
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Upcoming AGMs** Code | Company Name | Date | Status | RDF | Redefine Properties Ltd | 22/02/2012 | Confirmed | CULP | Cullinan Holdings Ltd | 23/02/2012 | Confirmed | CUP2 | Cullinan Holdings Ltd | 23/02/2012 | Confirmed | CUL | Cullinan Holdings Ltd | 23/02/2012 | Confirmed | CUP3 | Cullinan Holdings Ltd | 23/02/2012 | Confirmed |
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