Podcast: Rand protection for your portfolio

Simon BrownJSE Direct, Latest

Rand protection for your portfolio

Rand protection for your portfolio

Simon Shares

  • Capitec* (JSE code: CPI) through results got everybody talking about the “arrears coverage ratio” dropping to 208% vs. 223% previously and vs. 196% in 2015. This got all the attention last time as well, I not concerned and my ‘aggressive’ buy price is now around R719.
  • I have some USD expenses due in the next week or so and have taken a hedge using NEWUSD* just in case.
  • Anchor Capital results showed a serious slowing of growth but still a stock with a great looking future and at around 600c very attractive.
  • I have been trying to add to my very very small Sea Harvest* holding but I don’t want to chase the stock as I think we may see some weakness in the weeks ahead. 1275c would be my ideal entry. It traded 1270c last week, but I wasn’t paying attention and missed them.
  • UK has triggered Brexit and now Scotland wants out of the UK.
  • A really excellent post by Kristia on bond ETFs.
  • Upcoming events

* I hold ungeared positions.

Protecting yourself from the Rand

With the Rand getting all hot and bothered again after a protracted run stronger I thought a quick look at how we can manage our portfolio against a weaker currency. We have the easy things like offshore stocks that are locally listed, offshore earning stocks, locally listed offshore ETFs and the NEWUSD mentioned above. There is also a pure offshore bank or brokerage account or heavily invested into commodity stocks. But the bigger issue is that political squabbles are part and parcel of being a South African investor and Rand weakness is also our future, even if at times we have strength. So we need to build a resilient portfolio that survives these events.

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