Worrying trend of poor returns by local pension and collective investment funds
24 April 2024 - 15:17
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Your editorial opinion refers (“Band-Aid on bullet wound?” April 24). As good as this article is, it needed to delve deeper into the issue of poor returns by local pension and collective investment funds over the past 10 years and more.
The ultimate price for this worrying trend has been borne by mom-and-pop investors and members of pension funds who have seen very little growth after inflation and costs.
Many of the big brand name funds could not even beat the inflation rate over this period. Spend some time analysing the investment returns of retirement funds subject to Regulation 28 of all the insurance companies and you will see the same trend.
An enormous retirement crisis is slowly building up in SA, which together with the collapse in the residential property market (excluding the Western Cape) has seen much middle-class wealth wiped out, or at best showing no growth at all.
At the same time, offshore funds have enjoyed a huge bull market, initially driven by the S&P 500 and Nasdaq boards, but also recently by the Japanese stock market, which has quietly and under the radar notched up significant returns for global investors.
SA investors with no direct offshore exposure can only dream of the 20%-plus returns offshore funds have achieved.
Gavin Butchart Via BusinessLIVE
JOIN THE DISCUSSION: Send us an email with your comments to letters@businesslive.co.za. Letters of more than 300 words will be edited for length. Anonymous correspondence will not be published. Writers should include a daytime telephone number.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
LETTER: Deeper dive needed
Worrying trend of poor returns by local pension and collective investment funds
Your editorial opinion refers (“Band-Aid on bullet wound?” April 24). As good as this article is, it needed to delve deeper into the issue of poor returns by local pension and collective investment funds over the past 10 years and more.
The ultimate price for this worrying trend has been borne by mom-and-pop investors and members of pension funds who have seen very little growth after inflation and costs.
Many of the big brand name funds could not even beat the inflation rate over this period. Spend some time analysing the investment returns of retirement funds subject to Regulation 28 of all the insurance companies and you will see the same trend.
An enormous retirement crisis is slowly building up in SA, which together with the collapse in the residential property market (excluding the Western Cape) has seen much middle-class wealth wiped out, or at best showing no growth at all.
At the same time, offshore funds have enjoyed a huge bull market, initially driven by the S&P 500 and Nasdaq boards, but also recently by the Japanese stock market, which has quietly and under the radar notched up significant returns for global investors.
SA investors with no direct offshore exposure can only dream of the 20%-plus returns offshore funds have achieved.
Gavin Butchart
Via BusinessLIVE
JOIN THE DISCUSSION: Send us an email with your comments to letters@businesslive.co.za. Letters of more than 300 words will be edited for length. Anonymous correspondence will not be published. Writers should include a daytime telephone number.
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