At this point in our economic cycle most people are despondent about the economic outlook of our economy in the short term. With the events of the last couple of years, nobody can blame them. Making irrational decisions because of fear or despondency has seldom paid the desired dividends. If, however one looks at offshore investment as part of a rigorous diversified investment philosophy it makes good investment sense.

Our economy makes up roughly 0.5% of the world economy and fund managers have roughly 388 shares to choose from. Most shares outside the Top 100 is regarded as medium to small capitalization shares which means they are too small for most fund managers to invest in.

If your horizons are widened to include the world markets, there are thousands of top companies to choose from. If on the other hand we see that our Rand has steadily depreciated at a rate of roughly 6.38% per annum over the last 30 years (albeit not in a straight line, see graph below, green line is the long-term average)

When the graph is below the green line the rand is stronger against the dollar than the average, and ideally you would want to take money out of the country and when the graph is way above the green line you would want to bring money back as you get more Rands for the dollar.

Having money offshore directly in dollars gives you the ability to have money paid out in an offshore banking account in dollars when you do want to spend some of your offshore dollars while on holiday abroad.

Investing locally in an offshore investment does give you some offshore exposure but your money must always be paid out to you in Rands, as the money never physically left the country.

Choosing the appropriate investment vehicle to invest in offshore can be daunting and that’s why we believe you can partner with us as we have been investing clients’ money offshore since 2001.

We can help you structure an appropriate offshore investment that’s tailored to your specific needs and goals.