1. R1.5m lying in money market accountsI am 52 and would like some direction as to what I can do to invest this money. I don’t want to lose any money but I’m prepared to take a bit of risk.
South African inflation has fluctuated between 4% and 8% over the past decade. Taking an average rate of 6%, which is not too far off the depreciation of the rand against the US dollar over this time , means every R100 you deposited in the bank 10 years ago would be worth about R54 today in purchasing power or real terms. That’s a huge loss. Naturally, any interest received would alleviate this loss somewhat.
Every asset class has an element of risk attached. The global rise in interest rates has highlighted the hazards of investing in the bond market. The value of a bond, with a fixed coupon, will move either up or down with the vagaries of the fixed interest market. An investor who bought 10-year US treasuries in early January 2022, when the interest rate was 1.6%, is significantly worse off with the present yield at 3.7%. Property attracts similar characteristics.
R100 invested 10 years ago in the S&P 500, a gauge of the US markets, would be worth R500 today , a return of 17.6% per annum. That return covers the depreciation of the rand against the US dollar and the rise in the US stock market .
Business Business Latest News, Business Business Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Source: BusinessTechSA - 🏆 24. / 61 Read more »