Rucking up Returns: Investor Insights Inspired by Rugby Coaches

The excitement is building for the 2023 Rugby World Cup (RWC).  Kickoff is 8 September in France and, as reigning champions, our nation's hopes rest on the shoulders of the Springbok squad of 33 for another win. With strategies, tactics and game plans in the news, now is a good time to take a lead from rugby coaching staff in your investment journey.

Rugby World Cup (RWC). Kickoff is 8 September in France and, as reigning champions, our nation's hopes rest on the shoulders of the Springbok squad of 33 for another win. With strategies, tactics and game plans in the news, now is a good time to take a lead from rugby coaching staff in your investment journey.

Siyabulela Nomoyi, Satrix's* quantitative portfolio manager, says, “We know that winning a rugby world cup relies on a number of factors coming together - the right coaches, right plan, right team, right mindset etc. And growing wealth actually has quite a few similarities.”

He said that investing through exchange-traded funds (ETFs) is an excellent way to start an investment journey.  They are low cost, very accessible and easy to manage. Satrix is the country’s leading provider of ETFs.

Nomoyi says some of the winning aspects of a good RWC campaign could be applied in the world of investing. Here are some rugby roles that you can take on in your own winning strategy:

1. The Head Coach: Strategy Is Everything

Remember how the Springboks executed "The Move" in the 2019 Rugby World Cup final? That strategy took them to victory. Just as rugby teams dissect their opponents and forge plans to increase chances of a win, your investments need a clear game plan. To successfully build wealth through investing, you should look at crafting a roadmap that aligns with your long-term goals and risk appetite, much like the Springboks' tactical masterpiece. This can be done in conjunction with a financial adviser or by doing careful research and using the wealth of online information to help you build the right plan.

2. The Selector: Diversity Is Key

Look at the Springbok squad for the 2023 World Cup – a medley of players who all bring something special to the squad. The fast, the strong, the accurate, the leader. Similarly, diversification in investing is a key play. By spreading your investments across various sectors and asset classes, such as local and global equities, bonds and cash, you create a cushion against market fluctuations. This approach reduces the impact of a single loss and could amp up your overall portfolio performance.

3. The Tactician: The Right Tools Should Be In Place

The Springboks have constantly come up with new configurations for their bench to keep the on-field momentum going. Last World Cup they ditched the traditional five-three split between forwards and backs for six-two. Now they have been experimenting with seven-one. Just like these tactics keep the Springboks forward momentum consistent, low-cost index funds do the same for your investments. They trim down fees that could otherwise eat into your returns over time, keeping your investment's efficacy intact.

4. The Whole 15: Balancing Risk and Safety

Ever notice how the Springboks choose the right moments to take risks on the rugby field? Your investment journey will thrive on the same balance. Like a rugby team balancing defensive plays and daring attacks, a well-rounded investment portfolio combines both high- and low-risk investments. Index funds, like dependable teammates, replicate established market trends, offering you a sturdy strategy.

5. The Captain: Weathering Market Storms

The Springboks' resilience after their tough loss in their first game of the 2019 tournament - a tough lesson but they bounced back and won. Similarly, when investment markets are turbulent, maintaining your strategy matters. Resisting the urge to make impulsive changes during market downturns will make sure you don’t lock in any losses and you will still be in the market when it starts to perform better again. Staying the course can lead to long-term gains, just like the Springboks' triumphant comeback.

6. The Analyst: Learning From Wins and Losses

In rugby, every game, whether it ends in cheers or tears, holds a nugget of wisdom. It's the same with investments. Each outcome, good or bad, can teach you valuable lessons. So, as you tune into the Rugby World Cup, consider how the strategies employed by different teams could guide your investment journey.

As Nomoyi points out, "Much like a well-executed rugby game plan, investing strategically can lead to substantial victories in the financial arena." So, embrace these rugby-infused tactics and watch as your investment game transforms into a winning streak. 

*Satrix, a division of Sanlam Investment Management

Satrix Investments (Pty) Ltd is an approved FSP in term of the Financial Advisory and Intermediary Services Act (FAIS). The information does not constitute advice as contemplated in FAIS. Use or rely on this information at your own risk. Consult your Financial Adviser before making an investment decision. Satrix Managers is a registered Manager in terms of the Collective Investment Schemes Control Act, 2002.

While every effort has been made to ensure the reasonableness and accuracy of the information contained in this document (“the information”), the FSPs, their shareholders, subsidiaries, clients, agents, officers and employees do not make any representations or warranties regarding the accuracy or suitability of the information and shall not be held responsible and disclaims all liability for any loss, liability and damage whatsoever suffered as a result of or which may be attributable, directly or indirectly, to any use of or reliance upon the information. 

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