A Message from Mark Jurgens
Greetings,
As 2024 draws to a close, it feels like a year of contrasting emotions and events. Reflecting on the journey, it is evident that it has been marked by challenges, growth and significant milestones, both professionally and personally.
The year began with modest expectations in the investment landscape. After an excellent 2023 for global markets, the outlook for our local environment seemed uninspiring. However, key events throughout the year have changed that perception.
In February our annual company conference focused on the use of artificial intelligence within the workspace as well as the industry. The event was a resounding success with interesting discussions, presentations and supportive team building activities.
June brought the London investments conference where global challenges were debated. Despite inflation, wars and multiple elections, the second half of the year saw optimism boom, particularly following our local elections. The Government of National Unity has brought a wave of hope, driving the JSE to new highs. Global markets also exceeded expectations, resulting in satisfied investors.
Jurgens Finance has experienced significant growth this year. This has necessitated a move to a larger workspace, ending an era as we said goodbye to our home of 26 years. While the move was both emotional and challenging, we are settling into our new home, ready for the opportunities ahead.
On a more personal note, this year has been a poignant one for my family. The loss of my father and mother-in-law to cancer was unexpected and extremely impactful. In times like these, I am reminded of the strength and kindness of those around me. We are grateful for the unwavering support from colleagues and clients.
2024 has also been an exciting year for our partner at Anchor Capital. Their Credo acquisition in the UK and strong portfolio performance have been highlights, reinforcing the value they bring to our partnership.
As we end this year, I want to extend my heartfelt thanks to all of you – our valued clients. Your support and loyalty are very much appreciated. A big thank you again to all at Jurgens Group for their hard work and commitment.
Here’s to 2025 and the opportunities it holds.
Wishing you a peaceful festive season and a prosperous new year.
Mark
Welcome to the age of the ‘’new normal’’ from Alan Botha:
Is This the New Normal in Investing, or Do Timeless Lessons Still Apply?
The global investment landscape is shifting dramatically. Between the rise of technology-driven markets, geopolitical upheavals, pandemic aftershocks, and sustainability pressures, many wonder whether we have entered a “new normal” that requires abandoning traditional investment principles. Are the fundamentals still relevant, or do they need to be reframed in today’s context? While the tools, markets, and external factors may change, the bedrock principles of investing remain vital. We believe that the key lies in adapting timeless lessons to new challenges.
The “New Normal” Defined The phrase “new normal” emerged during the 2008 financial crisis, but its relevance has grown in recent years. It signifies an environment where traditional assumptions no longer hold, due to structural disruptions. Today, the “new normal” is shaped by several factors:
1. Digital Transformation: AI, blockchain, and fintech are reshaping industries, creating opportunities in sectors like cloud computing, cybersecurity, and digital payments. Companies that once struggled with traditional valuation metrics are now dominating global markets.
2. Geopolitical Realities: Trade wars, energy crises, and regional instability have made global markets volatile and interconnected. For investors, this means recalibrating risk in a world where shocks can ripple faster than ever.
3. Sustainability and ESG Investing: Environmental, social, and governance (ESG) considerations have moved from niche concerns to mainstream priorities. Investors are increasingly favouring companies with strong sustainability credentials, impacting valuations and strategies.
4. Post-Pandemic Shifts: The COVID-19 pandemic accelerated remote work, e-commerce, and healthcare innovation, creating winners and losers. It also tested the resilience of traditional asset classes like property and bonds.
In such an environment, sticking rigidly to old norms could be limiting. However, discarding foundational principles could prove equally dangerous.
Timeless Lessons: The Core of Solid Fundamentals
Despite the noise of latest trends, certain investment truths have stood the test of time. These principles provide a framework that can accommodate innovation and unpredictability:
1. Diversification: The adage “don’t put all your eggs in one basket” remains critical. Diversification across asset classes, sectors, and geographies helps mitigate risks. Even in a high-tech, interconnected world, the benefits of diversification have not diminished.
2. Long-Term Perspective: Markets are inherently cyclical. While short-term trends like meme stocks or speculative bubbles capture headlines, they often burn out quickly. A disciplined focus on long-term growth helps investors weather volatility.
3. Valuation Discipline: Fundamentals like earnings, cash flow, and balance sheets still matter. Although some tech giants thrive on forward-looking metrics, ignoring valuation discipline can lead to overpaying for future promises.
4. Compounding: Harnessing the power of compounding over decades is a lesson reinforced by investing legends like Warren Buffett. This principle thrives on consistency and patience, regardless of the environment.
5. Emotional Control: Fear and greed remain powerful forces. Behavioural biases drive irrational decision-making, especially in volatile times. Staying grounded in data and avoiding knee-jerk reactions is essential.
Reconciling the Old and the New
The modern investment landscape requires not abandoning fundamentals but enhancing them with new insights. Here’s how timeless lessons marry today’s realities:
1. Diversification with a Tech Edge: While diversification is essential, investors must also acknowledge the outsized influence of tech giants. A portfolio today might include a higher weighting of technology-driven sectors while balancing traditional industries.
2. Valuation in the Context of Growth: For high-growth industries like AI or biotech, traditional valuation metrics may need reinterpretation. Investors should seek a balance between paying for potential and avoiding speculative bubbles.
3. Incorporating ESG: Fundamentals now include factors like carbon footprints, labour practices, and governance quality. Companies excelling in these areas are increasingly viewed as lower-risk, long-term bets.
4. Adapting to Geopolitical Risks: Diversifying geographically means more than spreading across countries; it involves understanding regional dynamics and supply chain dependencies.
5. Digital Tools for Emotional Control: Technology offers tools like algorithmic trading and robo-advisors to help investors remove emotion from decision-making. However, human judgment remains indispensable for nuanced situations.
Conclusion:
While the investing world has undoubtedly evolved, the principles underpinning long-term success remain remarkably stable. The key is to embrace change without losing sight of the basics. Diversification, valuation, and emotional discipline still serve as anchors in turbulent waters. At the same time, integrating new realities like technological innovation, ESG metrics, and geopolitical risks ensures relevance.
The “new normal” does not render timeless lessons obsolete; instead, it challenges investors to reinterpret and apply them with fresh perspective. By combining the old with the new, investors can navigate uncertainty and build wealth for the future.
Keep well,
Alan
Quote of the Day
"It's not how much money you make, but how much money you keep, how hard it works for you, and how many generations you keep it for."
Short Term News Update from Greg Brits
Good day,
What a year it has been!
It’s hard to believe that Christmas is already here and that 2025 is just around the corner.
With the festive season upon us, it’s time to unwind with loved ones, family, and friends, and to look forward to a well-deserved break for those who are taking time off.
Please remember that our offices will remain open throughout the holiday season to assist with claims and changes to policies.
The short-term insurance industry has faced numerous challenges this year, with reinsurance markets continuing to put pressure on South African insurance companies. The announcement of Discovery Insure closing its commercial division earlier this year, after just seven years of operation, raised eyebrows. We may see further changes in 2025, however, in this quarterly update, I’d like to highlight some key aspects of your policy that are important to note.
Below are crucial points that have been hot topics in the insurance market during 2024:
1. Solar Systems:
Once installed, solar systems are not automatically covered in your policy, so you must notify your insurer. Always use accredited solar installers who provide a Certificate of Compliance (COC), which is required by insurers. Make sure the installer has a valid Contractors All Risk policy in place to cover any property damage they might cause while on-site.
2. Alarm Systems:
If your policy includes a linked alarm warranty, it means your insurer has imposed a condition for theft cover to be in place. Your alarm system must be linked to an armed response company and be in working order at all times. It must also be activated when your home is unoccupied. Ensure your alarm company receives opening and closing signals, and check that your batteries are in good working order. If possible, upgrade to a lithium battery for longer life. Having an additional battery linked to the system can help ensure longer signal connectivity.
3. Storm and Water Damage:
Storms and excessive water can damage buildings, home contents, or business assets if proper maintenance is neglected. Regularly clean gutters, check waterproofing on roofs and perform general property upkeep. Wear and tear or gradual deterioration over time is not covered by insurers, so it’s essential to maintain your property to avoid complications at the claims stage.
4. Power Surge Protection:
Power surge protection is now standard for homes and businesses. A Type 2 Surge Protection Device (SPD) should be installed on your main distribution box. For businesses with 3-phase power, a Type 1 SPD may also be necessary. We recommend using a trusted electrician for these installations and remember that a Certificate of Compliance (COC) is required after installation.
5. Motor Vehicle Theft:
Certain motor brands and specific models, particularly in the Toyota range, are a growing concern for insurers. Ford Rangers are also experiencing an increase in theft and hijacking incidents. If your policy requires a dual tracking device or a backup tracking unit, please ensure you comply with this condition to avoid potential claim rejections.
6. Thatch Homes and Structures:
Thatch homes, lapas, and similar structures are considered high-risk by insurers due to their fire exposure and issues related to maintenance. Compliance with the conditions set out in your policy words is crucial to ensure coverage remains valid.
7. Tree Felling:
Carrying out tree felling, when necessary, can help prevent overgrowth and enhance the stability of trees during storms.
8. Vehicle Tyre Condition:
Please check the tread depth of your vehicle’s tyres to ensure they meet legal requirements, as insurers may inspect this at the claims stage.
We would like to take this opportunity to thank all our loyal clients for your continued support. We wish you and your families a blessed Christmas and a prosperous 2025.
If you are travelling, please stay safe, be cautious, and remain aware of potential risks. Lastly, we kindly ask that you refrain from unsubscribing from our “IMPORTANT NOTICE” e-mail notifications. These contain valuable information that may help prevent issues when making claims. If you have any questions about the points mentioned above, please do not hesitate to contact our office.
Best Regards,
Jurgens Insurance Brokers Team
