About the website:
Welcome to The South African Index Investor – a forum developed not only for index investors, but also for those investors who are interested in making rational investment decisions. Index investing should form part of that process, but then again I do not necessarily hold a fundamentalist view on index investing and believe that active investing has indeed an important role to play in your overall investment strategy.
I have done extensive research on active and index investing strategies with special reference to the South African collective fund industry (mutual funds). I believe, quite simply, that selecting the previous year’s top performer year after year is a worse long-term strategy than selecting and continuing investing with a so-called mediocre fund. First of all transaction costs do matter; second, the performance of active management is seldom consistent; and third, actively-managed funds are normally aggressively marketed on especially short-term performance records, which brings us back to the two concerns raised earlier.
As mentioned in the opening paragraph this forum is dedicated to rational and hopefully successful investing – which is accomplished by following a multi-disciplinary approach towards your investment plan. Not only do you need to be aware of economic fundamentals and conditions that will underpin your potential investment growth, but also that financial markets are probably driven more by the aggregate investment psychology (prevailing market sentiments) than is normally perceived.
One other elementary understanding is required – the world of investing is a business. If you entrust your investments to professionals understand that they are in business to make money. Whether they primarily look after your interest is sometimes debatable, but I know they cannot guarantee performance “or your money back”.
You and only you will eventually have to live with the “fruits” of your investment efforts. You can blame poor markets, incompetent investment advisors/managers and the like as much as you please, but ultimately the responsibility for your investment decisions is yours. My best advice to you would be to gain as much investment knowledge as possible. You do not need to be a do-it-yourself investor, but be knowledgeable enough to identify whether you are receiving value for money or not. If not, index investing will provide you with reasonable results at considerably lower costs than those associated with “professional” investing.
Step out of the conventional! Experience, debate, accept or reject alternative ideas. That is the only way to learn. This is your forum: have your say, test my views and hopefully I shall back them up with hard facts.
Daniel R Wessels
|I am a authorised financial advisor by profession, researcher by interest, and an investor by passion. What is more, I am independent, and by choice! I have freedom in expressing my views and ideas, I do not necessarily support any specific school of thought, nor are my views or ideas necessarily supported by any specific institution or group. I observe the world as it is, no “sacred cows”, no “vested interests”, no fear of “conflict of interest”. However, I do assume responsibility for the financial “well-being” of my clients, therefore I shall do my utmost to unravel the intricacies of those paths leading to financial success and reward.
Why this website? I thought it would be sensible to share my experience and knowledge with a potentially wider audience than just my personal client base. This website is a sincere attempt to “live the dream”.
For those who wished for a more “bells and whistles”-look to the website, I have to remind you this is all about intent and content. I want to present information as clearly as possible and not cause distraction by some “flashing icons” on the screen! Notwithstanding, I would appreciate feedback on how to make this presentation even more user-friendly.
My wish is that at least some aspects of my discussion would motivate you to further study and a fresh look at the exciting world of investing.