Simon Brown, founder at Just One Lap, joins us in this insightful episode, focused on how to get started with buying shares. We start with the basics, such as what a share is and get into more complicated topics such as share valuation. The important takeaway from this episode is that unless you are spending a lot of time on research, buying a basket of shares, called an exchange traded fund (ETF), is the best kind of share to buy.
If you buy an ETF you mitigate the risk of buying shares in a company that goes bankrupt, or an industry that is in decline. When you “buy the market” by buying an ETF, you will get average market returns over the long run. Average returns on the Johannesburg Stock Exchange are inflation beating and, when compounded over many years can lead to substantial capital growth. There are many different ETFs you can buy, both locally and overseas. Before buying a stock it is important to do your research to understand what you are buying, and to choose a stock with the lowest possible fees. The worst thing to do is to buy a stock based on advice from a friend at a braai, or even the financial media. You need to do thorough research. An excellent resource on buying shares can be found at Simon’s website: justonelap.com.
Disclaimer: Old Mutual Life Assurance Company (South Africa) Limited is a Licensed Financial Service Provider. This material is not intended as and does not constitute financial advice or any other advice and is neither exhaustive nor prescriptive. It does not take into account your personal financial circumstances. Your financial adviser will assess your financial situation and needs and assist you to draw up a plan to help you achieve your financial goals. The views expressed by the contributor are his or her own (as an independently registered financial services provider, financial adviser or other independent capacity), and not necessarily endorsed by Old Mutual (as a separate financial services provider).
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