Why investing abroad is your next money move
Whether you’re an investor aiming for more certainty, more return or more impact, STANLIB has a fund solution for you. The STANLIB Your Money Can Do More podcast series hosted by Bongani Bingwa and STANLIB’s Chief Economist Kevin Lings features experts who will help potential investors navigate and plan for tomorrow, today.
In this episode, Bongani and Kevin are joined by Neil Robson, Head of Global Equities at Columbia Threadneedle Investments to discuss the risks and rewards surrounding international investments and the best ways to start taking your money abroad.
Listen to the audio below:
The US stock market is up by over 20% this year and investors across the globe are reaping the rewards. With the world in flux — South Africa is no exception — where does an investor find value and the potential for more returns? While South Africa is still a worthy investment opportunity for investors, it would be unwise to miss out on the benefits within the foreign market.
So how does a keen local investor looking to invest his money offshore begin his search when other countries seem just as risky and uncertain — wouldn’t it be safer to invest solely in South Africa? STANLIB’s Chief Economist, Kevin Lings thinks otherwise.
Lings advises investors to look beyond South African borders so that their money isn’t trapped into a limited selection of investments. Yes, the risk is still present in other countries but it grants investors the ability to expose their potential investment to outside opportunities.
When we mention this, people kind of view it as being unpatriotic. That somehow, you’re not believing in the country if you want to take some of your money offshore and that’s not the case at all. It is about simply diversifying your risk.Kevin Lings, Chief Economist at STANLIB
Living in South Africa, the advice is ‘don't put all your eggs in one basket,’ try and spread that across the globe and then, critically, get someone who knows what they’re doing to manage that.Kevin Lings, Chief Economist at STANLIB
Columbia Threadneedle Investments’ Neil Robson says that South Africa has already integrated into the global economy by using multinational brands like Microsoft, Toyota and Amazon. He suggests that because we already value these companies in our personal consumption, it wouldn’t be a bad idea to have them represented in our investment portfolios.
An important factor that would impact an investors choice in a foreign company is Environmental, Social and Corporate Governance (ESG) principles. Understanding these principles is vital for any investors navigating the foreign market.
Environmental, social and governance are really about thinking about risk from each of those factors. I think, what's changed though is that if you look at it now, people care about what clothes they wear, what products they’re using and how it impacts the environment.Neil Robson, Head of Global Equity at Columbia Threadneedle Investments
People start to care about [those principles] … Brands care about what you think about them and therefore the companies are changing their behaviours erratically and it's also producing new growth potential.Neil Robson, Head of Global Equity at Columbia Threadneedle Investment
The world of investment is no longer focused on only investing in companies that seem highly profitable, it’s more about what will last in this ever-changing landscape. Durability, adaptability and potential is the name of the game, but finding the next disruptor, the next Google or Amazon is not the easiest task. Due to South Africa’s limited market, investing abroad helps your chances at finding these gems and benefiting from them.
There are some great businesses, some great investment trends that are just not represented in the South African stock market and you should have exposure to them, whether that be cloud computing, whether that be innovative medical procedures, whether that be some new industrial technology… Anything like that, might not be well-represented in South Africa.Neil Robson, Head of Global Equity at Columbia Threadneedle Investments
The Hero Fund Solution
STANLIB, in partnership with Columbia Threadneedle, has provided two options for the South African investor looking to go offshore. The STANLIB Global Equity Fund, which aims to provide investors with long term capital growth from a diverse and actively managed range of shares selected from the global stock market. As well as the STANLIB Global Balanced Fund which invests in a diverse combination of global shares and securities across sectors and geographies while maintaining a high equity exposure.
I think that the link-up with Columbia Thread Needle allows you to [Invest offshore] better than the average. To me, it's been a phenomenal success story.Kevin Lings, Chief Economist at STANLIB
To find out more about how STANLIB is helping and preparing their clients’ investments for the future, visit www.STANLIB.com/more now!