Fourth Quarter 2019 – In Touch

jurgens group fourth quarter 2019

Memorable Year - Mark Jurgens

2019 will always be a memorable year for Jurgens Group, the year our company celebrated its 30th birthday. It is with thanks to all our clients for their appreciated support during these many years, that this remarkable milestone could be successfully achieved.

The financial services industry continues to prosper and has become more positively competitive for investors than ever before. Viable fee structures and added opportunities to invest in an extensive range of products such as private equity, property, Hedge Funds and an array of offshore products. Tighter regulations and controls have been implemented making such investments a safer, more secure and attractive option than in the past.

Some may already be aware that Investec Asset Management (IAM) will soon have a new name, branding and identity. On 21 November 2019, media announcements were made revealing IAM’s new name.

Investec Asset Management New Name and Identity

investec to ninety one

The new name is Ninety One

1991 saw the establishment of Investec Asset Management in South Africa. A decision was taken in 2018 by the Boards of Investec plc and Investec Limited (collectively “Investec Group”) that Investec Asset management (IAM) would become separately listed entity on the Johannesburg Stock Exchange and the London Stock Exchange.

The completion of the demerger and independent listing of IAM is expected to be by end of the first quarter of 2020. IAM being listed separately from Investec Group, ensures a fairer reflection of the IAM share price performance.

Please do not alarmed, beyond the name change, there will be no change to the team, which is assurance to clients that the culture, purpose and values remain in place for long-term stability and continuity. This to applies to the fee structure, service levels and product range we have become accustomed to.

A quick look-back at 2018, which was a year where all stock markets in the world performed negatively, with December 2018 having by far the worst performance. Fortunately, from January this year, the year to date figures for our SA unit trusts are looking so much better than previous years. This is most encouraging and positive to see.

Some further encouraging news is that the official consumer inflation rate dropped to 3,7% in October, from 4,1% in September – offering some relief for consumers. It’s the lowest since February 2011. The SA Reserve Bank’s decision to keep Interest rates unchanged was expected.

There was also the call by the Minister of Finance Tito Mboweni for a series of “deliberate and concerted actions” to raise SA’s GDP growth rate by up to 3% per year.

Recently many senior officials in government departments have been removed from their positions as well as an increase in prosecutions instituted by the National Prosecutor.  These are all encouraging signs in the fight against corruption. As for the appointment of the new CEO of Eskom, Andre de Ruyter, this can be seen as a refreshing apolitical choice.

As South Africans we can all help with the fight against corruption and embrace each other work together in creating the environment we are all striving for.

We would like to express our sincerest appreciation for your loyalty and for the trust you have places in us at Jurgens Finance. May the coming year bring you and your family peace, happiness and success.

The Optimist Curse from Alan Botha

financial optimisation

Oh my, where has 2019 gone and what a year it has been, filled with drama, excitement and politics across the globe that defy belief. Who would have thought a couple of years ago that we would have Donal Trump and Boris Johnson running two of the most powerful democracies in the world? In SA , we continue to be bombarded with “negative news” and newsmakers are never short of stories to make us all rescind in horror, wondering why we haven’t  packed for Perth yet.

Even the springbok triumph at the Rugby World Cup and the #imstaying campaign don’t seem to be enough to lift our spirits, with our pension plans, house prices and other investments in SA underperforming over the past 5 years, relative to some of our global developed market counterparts. The below is an extract from Morgan Housel article published in January 2016 in the Motley Fool which puts our human traits of pessimism in perspective.

“For reasons I have never understood, people like to hear that the world is going to hell,” says historian Deirdre N. McCloskey. It’s hard to argue. Despite the record of tings getting better for most people most of the time, pessimism isn’t just more attention to than the optimism who is often viewed as an oblivious sucker”

In investing, a bull sounds like a reckless cheerleader, while a bear sounds like a sharp mind who has dug past the headlines – despite the record of the S&P 500 rising 18,000-fold over the last century. Wharton Professor Jeremy Siegel is often chided as a perma-stock-bull, blindly cheering for a higher market every time he goes on TV. But he’s done it since the early 1980s, a period in which the market increased in value 40 times over. Alas, few cares about past results when someone else is warning about The Next Great Depression.

 Here are a few other reasons Housel observed for why pessimism gets so much attention.

  • Optimism appears oblivious to risks, so by default pessimism looks more intelligent.

But that’s a wrong way to view optimism. Most optimism will tell you things will get ugly, that we’ll have recessions, bear markets, wars, panics and pandemics. But they remain optimistic because they set themselves up in portfolio, career, and disposition to ensure those downsides. To the pessimist a bad event is the end of the story. To the optimist it’s a slow chapter in an otherwise excellent book. The difference between an optimist and a pessimist often comes down to endurance and time frame.

  • Pessimism shows that not everything is moving in the right direction, which helps you rationalize the personal shortcomings we all have. Misery loves company, as they say. Realizing that things outside your control could be the cause of your own problems is a comforting feeling, so we’re attracted to it.
  • Pessimism requires action, whereas optimism means staying the course. Pessimism is “SELL, GET OUT, RUN,” which grabs your attention because its an action you need to take right now. You don’t want to read the article later or skim over the details, because you might get hurt. Optimism is mostly, “Don’t worry, stay the course, we’ll be alright,” which is easy to ignore since it doesn’t require doing anything.
  • Optimism sounds like a sales pitch, while pessimism sounds like someone trying to help you. And that’s often the truth. But in general, most of the time, optimism is the correct default setting, and pessimism can be as big a sales pitch as anything – especially if it’s around emotional topics like money and politics.
  • Pessimists extrapolate present trends without accounting for how reliably markets adapt. That’s important, because pessimistic views often start with a foundation of rational analysis, so the warning appears as reasonable as it is scary.

In short, the more we exude positivity, the better our chances of staying the course and sticking to a proven investment strategy. No market cycle lasts forever and let’s hope 2020 is the catalyst for better things to come in SA going forward.

Short Term News Update – Greg Brits

Sadly, we recently lost a valued member of our team, Patience Mashinini. Our heart-felt sympathy goes out to her family at this difficult time. We will all remember the great human being Patience was.

It’s that time of the year when many are able to take a deserved break from a what has proved to be a tough year. With this, unfortunately, crime seems to increase as advantage is taken of many homes and premises being unoccupied.

If you are planning on going on holiday, please bear the following in mind:

  • Test your alarm and ensure that your armed response company gets the signal. (You should do this at least every two months or after a storm, to ensure that signals are received by the relevant control room).
  • Arrange with neighbours or friends to be watchful of any suspicious activity while you are away. Providing a set of keys in case of an emergency to access the premises is important, as well as leaving our office contact details. Our offices do not close over the festive season.
  • Before setting out on a long journey, have your vehicle checked thoroughly.
  • Buying new appliances and TV’s and leaving the packaging on your verge with other general garbage, is a sure sign for interested thieves.
  • Needing Travel Insurance? Please contact us.

Please bear in mind, should any changes have been made to your security system/contracts, building alterations, vehicle modifications etc, that insurance policies are written according to specific criteria being met. Should this change, for example, but not limited to, adding a door without a security gate or building a thatch lapa, please inform our office so that we can negotiate new terms with your insurer.

At the close of another year, we gratefully pause to wish you a warm and happy Holiday Season and to thank you for your on-going support.