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The Naspers Board is immensely proud of what our people achieved during the past year. They managed the pandemic, delivered powerful revenue growth and lifted profitability. Foundations were laid for future growth. The year ended 31 March 2021 (FY21) was an extraordinary period.
Investing in the stock market has played a key role in helping investors diversify their portfolios. Money Market funds and savings account are instruments used by investors and savers, looking to grow wealth in a risk averse manner.
In order to survive as a species, people have evolved to be both risk averse and loss averse, to be fearful of such possibilities. But these attributes serve us poorly as investors. To be a successful investor, one needs to overcome that fear and to take calculated risks.
History, of course, tells us that Ponzi schemes and financial scams are nothing new. However, their sophistication in the online space and in a digitally connected world are tailor-made for casting a wider, global net that lures potential investors with promises of 20% or 30% returns – or, in one recent incident, interest of 7% a week.
The investment world looks very different today compared to what it’s looked like in the recent past and requires investors to challenge pre-conceived notions. In this article, I highlight three ways in which the investment world has changed over time and how investors can best prepare and adapt to the shifts being seen.
Fear-fuelled stockpiling offers astute investors valuable insights into human nature. In August 2020, South Africans formed long queues outside liquor stores across the country, hoping to stock up on alcohol before a rumoured ban came into effect. But, as it turns out, the ban was fake news, spread on WhatsApp and social media.
The stock market can be volatile, but it’s a market that many people will delve into at some point in their lives whether directly buying shares or through their employer retirement saving fund. I believe that investments should form a core part of any financial planning, even during uncertain times.
As if the threat of a large-scale outbreak of an infectious disease isn’t enough to worry about, coronavirus has financial implications too. You might have read about the virtual shutdown of industries in some parts of the world and large falls in global stock markets and in the price of commodities such as oil.
It’s always darkest before the dawn, and markets across the globe are looking pretty dark right now. I’m not saying that the worst is over, or nearly over (my crystal ball is simply not giving me any clear answers) but if you look at the past, history will remind you that following the herd and selling up due to panic are not sensible strategies.
The spread of coronavirus, COVID-19, beyond China has created fresh uncertainty for the global growth outlook and sparked volatility in financial markets. Outbreaks in South Korea, Iran and Italy have raised concerns that the spread outside of China may be accelerating.
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