Tuesday, 11 August 2015 - 20:00
Charts
Seed Weekly - Investment Vehicles
As South Africans we have a number of different investment vehicles to our disposal. Each vehicle presents us with a different set of opportunities to potentially take advantage of as the benefits of the various pre- & post retirement vehicles remains underutilised by many. This article will not list all the pros and cons of each vehicle but rather look at ways these vehicles can be used to benefit the member.
We have always held the belief that a person’s overall asset allocation is one of the main determinants of the eventual success of an investment strategy. A successful investment strategy has many moving parts and as such has many different factors to take account of; the ‘big picture’ top down makeup of your balance sheet arguably has the biggest impact on your position over time. To take it one step further, we find it essential to look through the asset allocation and determine the best way to access the various asset classes.
Under normal circumstances we would recommend that an investor carries a certain exposure to growth and income generating assets (both local and offshore). The best way to access these asset classes is to consider the appropriate vehicles to your disposal and, very importantly, the goal of this specific asset class.
Growth assets are, generally & in the long term, best housed in a vehicle where the growth and dividends are untaxed, this is possible through utilising compulsory vehicles. As the untaxed growth and dividends compound over time it will outperform a similar investment in a self-funded (net of taxes) discretionary account. There are however 2 problems with the above statement;
• Compulsory vehicles are generally limited in the amount of growth assets that can be held where discretionary vehicles do not have this constraint.
• Income withdrawn from compulsory vehicles (after conversion to a living annuity) is in most cases taxed a much higher rate than income from discretionary sources (as long as the income from the discretionary sources are taxed as interest, CGT or dividends).
A potential solution to the above problems include using a Tax Free Savings Account (TFSA) to house some growth assets. TFSA’s have their own issue in that the amount of capital that can be committed at any time is limited, this account needs to be built up over the long term and it will be some time still before this will have a measurable effect on most clients’ position.
The solution that, in most cases, works the best is to make sure that your compulsory vehicles are fully exposed to growth assets up to the regulated limits. This is done through balanced funds in pre-retirement vehicles. Upon reaching the age of 55 one can access a living annuity which does not carry any asset allocation constraints, this makes living annuities very attractive vehicles in which to hold growth assets as the growth within these vehicles remain untaxed. Mandatory income paid out of living annuities can, however, potentially offset this benefit.
It is therefore pertinent to look at the ‘big picture’ and determine how to structure your portfolio to gain the maximum benefit. The untaxed growth in compulsory vehicles need to weighed up against the income tax on annuity payments, while the lower taxed income stream generated by discretionary accounts needs to be weighed up against the tax paid on growth, dividends and interest. It is just as important to consider the best way to structure your income as it is to structure your capital base for growth as they are ultimately intertwined.
The above is but one of the many factors the team at Seed takes cognisance of when designing solutions to our clients. Each solution we design is unique and tailored to your needs. We also monitor these solutions continuously and will make adjustments as circumstances dictate.
Kind regards,
Stefan Keeve
Tel +27 21 914 4966
Fax +27 21 914 4912
Email info@seedinvestments.co.za
Seed is hiring: Click through to our LinkedIn profiles to see vacancies at Seed Investment Consultants and Seed Analytics
www.seedinvestments.co.za
Tue, 11 Aug 2015
Top News
Local markets
After the public holiday yesterday, the JSE All Share ended 0.40% higher today with gains led by gold miners. Full story
South Africa's rand touched its weakest point against the dollar in nearly a week on Tuesday, falling one percent to 12.7840.
The local unit suffered along with fellow emerging market currencies following the Chinese central bank's decision to devalue the yuan after a string of poo Full story |
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The Turkish military ratcheted up pressure on Kurdish militants with a fresh round of air strikes in the southeast of the country on Tuesday as the insurgents claimed responsibility for the bombing of a police station in Istanbul. Full storyRiot police clashed early on Tuesday with protesters in the streets of Ferguson, Missouri marking the anniversary of the police shooting of an unarmed black teen whose death sparked a national outcry over strained race relations. Full storyJapan has restarted a nuclear reactor for the first time under new safety standards put in place since the Fukushima disaster in 2011, as Prime Minister Shinzo Abe seeks to reassure a nervous public that the industry is now safe. Full story |
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Markets | China's 2 percent devaluation
of the yuan on Tuesday pushed the U.S. dollar higher and hit
Wall Street and other global equity markets. . . Full story | | Gold rose to a three-week high on
Tuesday as the dollar reversed gains, global stocks fell and
investors assessed the impact of China's. . . Full story | | Hong Kong stocks surrendered earlier
gains and ended lower on Tuesday, weighed down by Chinese
airlines and importers, sectors seen likely to be. . . Full story | | Chinese stocks ended mixed on
Tuesday as the central bank's surprise decision to allow its
currency to fall hit the shares of airlines. . . Full story |
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| Australian shares fell 0.7
percent on Tuesday, largely led by losses in banks, after China
devalued its currency following disappointing economic data.. . . Full story | | Japan's Nikkei share average edged
down on Tuesday after China devalued the yuan by nearly two
percent, with investors taking profits as they. . . Full story | | Gold rose 1 percent to
above $1,100 an ounce on Monday, its biggest increase in more
than seven weeks, as the U.S. dollar. . . Full story | | Slowing demand in China led some
stock markets to rise on Monday, on hopes of more policy
stimulus, but commodity prices fell.. . . Full story |
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SA Business | South Africa's economy faces a turbulent time as the prospect of rising U.S. interest rates and a slowing Chinese economy complicate. . . Full story | | Ford Motor Company will start assembling its best-selling Ford Ranger pickup truck in Nigeria by the fourth quarter, as it expands. . . Full story | | South Africa's cash-strapped power utility Eskom said it plans to borrow more than 20 billion rand ($1.6 billion) from the domestic. . . Full story | | South Africa's nuclear power plant planning process is at an "advanced stage" and the multi-billion dollar procurement process should be completed. . . Full story |
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| South Africa's manufacturing production shrunk by 0.4 percent year-on-year in June after a revised 1.6 percent contraction in May, Statistics South. . . Full story | | Mining group Glencore is disputing South Africa power utility Eskom's [ESCJ.UL] 2 billion rand ($157 million) penalty claim for shoddy performance. . . Full story | | The fact that South Africa's central bank is concerned about the impact of policy normalisation in the United States does not. . . Full story | | Rwanda's franc was increasingly stable after months of volatility due to a firmer dollar, but could weaken 6 percent against the. . . Full story |
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| Statistics South Africa said on Tuesday that June mining data due for release on Thursday has been postponed to Aug. 25 because of revisions from January 2013.. . . Full story | | Standard Chartered has
become the second bank in a week to walk away from a
multi-billion dollar Australian coal project, leading
environmentalists to claim a major victory in one of the world's
top coal-producing nations.. . . Full story | | Britain's Just Retirement
has agreed to buy rival Partnership Assurance for 669
million pounds ($1 billion) in shares, hoping greater scale and
a stronger capital position will help it cope with changes that
have. . . Full story |
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Company News | Exxaro shareholders are referred to the announcement released by the Company on the Stock Exchange News Service on 28 July 2014,. . . Full story | | Shareholders are referred the cautionary announcement dated 15 May 2015 and the renewal of cautionary announcements dated 9 June 2015 and. . . Full story | | Crookes Brothers shareholders (ôShareholdersö) are referred to the announcement published by the Company on the Stock Exchange News Service (ôSENSö) of. . . Full story | | Shareholders are advised that at a general meeting of Mediclinic held today, 11 August 2015, all the ordinary and special resolutions. . . Full story |
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| On 25 April 2006 MMI Group Ltd. (formerly Momentum Group Ltd.) (the Issuer) issued ZAR1 000 000 000 Unsecured Subordinated Callable. . . Full story | | The business rescue proceedings of the Company are still ongoing and Shareholders are advised to continue exercising caution when dealing in. . . Full story | | MMI Group Limited raises R1.25 billion from the South African debt capital markets
MMI Group Limited (a registered long-term insurance company and. . . Full story | | Business Day highlighted that Steinhoff International Holdings, which gets more than half its revenue from Europe, indicated that its Frankfurt listing. . . Full story |
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Company Results | Revenue for the interim period lowered to R2.9 billion (R3.4 billion). Gross profit decreased to R698.3 million (R789.8 million). Profit from operating activities was higher at R167.4 million (R132.3 million). Profit for the period attributable to owners jumped to R100.5 million (R58.6 million). In addition, headline earnings per share shot up to 101cps (61cps).. . . Full story |
World Markets (Spot Prices)
Name | Time | RP | Move | % Move | JSE Overall | 17:00 | 52221.17 | 206.21 | 0.40% | JSE Top 40 | 17:00 | 46622.58 | 190.59 | 0.41% | JSE Gold | 17:00 | 783.63 | 21.58 | 2.83% | JSE Financial | 17:00 | 46507.38 | 313.77 | 0.68% | JSE Industrial | 17:00 | 75560.74 | 342.49 | 0.46% | JSE Indust 25 | 17:00 | 67398.40 | 316.07 | 0.47% | JSE Resource | 17:00 | 35635.11 | -193.96 | -0.54% | DJ Futures | 19:52 | 17312.00 | -241.00 | -1.37% | DJ Ind | 19:58 | 17377.96 | -237.21 | -1.35% | SP 500 | 19:58 | 2079.22 | -24.96 | -1.19% | Nasdaq | 19:58 | 5022.73 | -79.07 | -1.55% | FTSE 100 | 17:08 | 6667.31 | -68.91 | -1.02% | DAX | 18:10 | 11293.65 | -311.13 | -2.68% | CAC40 | 18:10 | 5099.03 | -96.38 | -1.86% | Nikkei | 08:28 | 20720.75 | -87.94 | -0.42% | Shanghai | 09:28 | 3927.91 | -.51 | -0.01% | Hang-Seng | 10:28 | 24498.21 | -22.91 | -0.09% | All Ords | 08:41 | 5473.10 | -31.80 | -0.58% | NZSE 50 | 07:48 | 5822.35 | -42.67 | -0.73% |
| | Name | Time | RP | Move | % Move | Gold $ | 20:00 | 1108.70 | 4.59 | 0.42% | Gold R | 19:58 | 14180.81 | 221.66 | 1.59% | Gold R/kg | 19:58 | 455924 | 11450 | 2.58% | Silver $ | 20:00 | 15.3140 | .0670 | 0.44% | Platinum $ | 20:00 | 987.41 | 5.41 | 0.55% | Palladium $ | 19:59 | 600.77 | -6.23 | -1.03% | R186 | 17:09 | 8.16 | -.02 | -0.24% | R204 | 17:08 | 7.50 | .00 | 0.00% | R207 | 17:08 | 7.71 | -.01 | -0.19% | Brent Crude | 19:58 | 48.86 | -.66 | -1.33% | USD / ZAR | 20:00 | 12.7906 | 0.1477 | 1.17% | GBP / ZAR | 19:55 | 19.8776 | 0.1853 | 0.94% | EUR/ ZAR | 19:55 | 14.1058 | 0.1692 | 1.21% | NZD/ ZAR | 19:58 | 8.3522 | -0.0073 | -0.09% | AUD / ZAR | 19:55 | 9.3221 | -0.0519 | -0.55% | USD / JPY | 20:00 | 125.1250 | 0.5550 | 0.45% | EUR / USD | 20:00 | 1.1030 | 0.0014 | 0.13% | GBP / USD | 20:00 | 1.5571 | -0.0016 | -0.10% |
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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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11/08/2015 | 221 | 136 | 55 | 412 | 234,199,577 | R16,638,540,174 | 240375 | 1686990 | 07/08/2015 | 169 | 185 | 62 | 416 | 210,730,391 | R12,730,638,359 | 175518 | 1304025 | 06/08/2015 | 146 | 206 | 69 | 421 | 260,806,125 | R17,728,307,180 | 246483 | 1509527 | 05/08/2015 | 198 | 136 | 67 | 401 | 239,293,693 | R17,226,814,380 | 221503 | 1351262 | 04/08/2015 | 239 | 114 | 67 | 420 | 297,071,799 | R17,397,904,518 | 243446 | 1358201 |
* Includes all listed instruments on the JSE
Index Summary Index Name | RP | Move | % Move | Top 40 | 46,622.58 | 190.59 | 0.41% | Industrial | 75,560.74 | 342.49 | 0.46% | Mid Cap | 68,656.70 | 154.32 | 0.23% | Small Cap | 59,737.74 | 447.02 | 0.75% | Resource 20 | 35,635.11 | -193.96 | -0.54% | Industrial 25 | 67,398.40 | 316.07 | 0.47% | Financial 15 | 17,605.30 | 169.47 | 0.97% | Financial & Ind. 30 | 73,008.25 | 460.85 | 0.64% | All Share | 52,221.17 | 206.21 | 0.40% | Oil & Gas | 8,465.51 | -821.16 | -8.84% | Mining | 21,237.81 | -99.66 | -0.47% | Gold Mining | 783.63 | 21.58 | 2.83% | Platinum Mining | 21.93 | .69 | 3.25% | GENERAL MINING | 6,530.00 | -73.33 | -1.11% | Oil & Gas Producers | 45,517.50 | -4415.20 | -8.84% | Basic Materials | 21,267.17 | 33.98 | 0.16% | Chemicals | 21,830.53 | 212.40 | 0.98% | Forestry & Paper | 50,324.87 | 862.25 | 1.74% | Industrial Metals | 6,613.72 | 332.34 | 5.29% | Industrials | 44,773.65 | 264.66 | 0.59% | General Industrials | 160.62 | 1.17 | 0.73% | Consumer Goods | 68,942.69 | 310.73 | 0.45% | Automobiles & Parts | 8,355.85 | 22.64 | 0.27% | Household Goods | 544.01 | 9 | 1.72% | Health Care | 10,064.33 | 68.19 | 0.68% | Beverages | 229.82 | 3.63 | 1.60% |
| | Index Name | RP | Move | % Move | Food Producers | 8,849.90 | 86.86 | 0.99% | Personal Goods | 1,053.40 | -20.77 | -1.93% | Consumer Services | 16,003.98 | -85.00 | -0.53% | General Retailers | 8,462.58 | -44.56 | -0.52% | Travel & Leisure | 6,137.42 | 22.50 | 0.37% | Media | 378.34 | -2.96 | -0.78% | Support Services | 3,356.28 | 27.09 | 0.81% | Telecommunications | 10,277.79 | 176.47 | 1.75% | Financials | 46,507.38 | 313.77 | 0.68% | Banks | 8,055.14 | 50.89 | 0.64% | Non-life Insurance | 55,076.92 | -74.02 | -0.13% | Life Insurance | 43,494.66 | 307.14 | 0.71% | General Financial | 4,849.35 | 22.86 | 0.47% | Technology | 70,807.72 | 32.79 | 0.05% | SHARIAH TOP40 | 3,455.36 | 19 | 0.54% | FTSE/JSE SHARIAH ALL | 3,658.41 | 20 | 0.56% | COAL MINING | 8,963.01 | -67 | -0.74% | FTSE JSE Fledgling | 6,728.79 | 50 | 0.74% | FTSE/JSE Alt X | 1,443.81 | 10 | 0.66% | SA LISTED PROPERTY | 667.02 | | 0.46% | CAPPED PROPERTY | 587.95 | | 0.82% | RESOURCE | 19,286.15 | -91 | -0.47% | DIVIDEND PLUS | 215.02 | 1 | 0.55% | FTSE/JSE RAFI 40 | 9,465.03 | 59 | 0.63% | Capped Top 40 | 24,901.37 | 104 | 0.42% | Capped All Share | 26,487.53 | 105 | 0.40% | JSE TABACO | 9,619.33 | 136 | 1.43% |
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Click here for the Sharenet Index Summary page
Latest Consensus Changes** Code | Company Name | Status | Updated | SGL | SIBANYE GOLD LIMITED | HOLD | 07/08/2015 | RES | RESILIENT PROPERTY INCOME... | HOLD | 07/08/2015 | OML | OLD MUTUAL PLC | BUY | 07/08/2015 | BAT | BRAIT S E | BUY | 07/08/2015 | NED | NEDBANK GROUP LTD | HOLD | 07/08/2015 |
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Results Expected** Expected | Company Name | Fin. Date | 12/08/2015 | MPACT | June 2015 (Interim) | 12/08/2015 | ROCKCASTLE | June 2015 (Final) | 13/08/2015 | ASCEN A | June 2015 (Final) | 13/08/2015 | ASCEN B | June 2015 (Final) | 13/08/2015 | CURRO | June 2015 (Interim) |
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Recent Dividends** Share Name | Dec-Date | LDT | Pay-Date | Amount | ARROWA | 07/08/15 | 28/08/15 | 07/09/15 | ZAR 0.1890 | ARROWB | 07/08/15 | 28/08/15 | 07/09/15 | ZAR 0.1890 | LIB-HOLD | 07/08/15 | 28/08/15 | 07/09/15 | ZAR 2.5400 | TRADEHOLD PREF | 06/08/15 | 21/08/15 | 01/09/15 | ZAR 0.1781 | INDLU | 06/08/15 | 28/08/15 | 07/09/15 | ZAR 0.0621 |
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Ex Div** Share Name | Dec-Date | LDT | Pay-Date | Amount | IMPL CONV | 30/07/15 | 06/08/15 | 21/08/15 | ZAR 250.0000 | HUDACO | 26/06/15 | 06/08/15 | 17/08/15 | ZAR 1.8000 | ECSP C2 | 22/07/15 | 06/08/15 | 17/08/15 | ZAR 0.9075 | ECSP C | 22/07/15 | 06/08/15 | 17/08/15 | ZAR 0.9075 | ECSP A | 22/07/15 | 06/08/15 | 17/08/15 | ZAR 0.6849 |
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Upcoming AGMs** Code | Company Name | Date | Status | RBA | RBA Holdings Ltd. | 11/08/2015 | Confirmed | PCT | Prescient Ltd. | 11/08/2015 | Confirmed | SOV | Sovereign Food Investments Ltd. | 12/08/2015 | Confirmed | HSP | Holdsport Ltd. | 12/08/2015 | Confirmed | LDO | Lodestone REIT Ltd. | 12/08/2015 | Confirmed |
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Stock Exchange News Service Click here for more SENS news
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