Podcast: Five Years of Market Shifts: Lessons from COVID

In the latest Ghost Stories podcast, The Finance Ghost had a conversation with Siyabulela Nomoyi, Quantitative Portfolio Manager at Satrix*, to explore five years of extraordinary market behaviour since COVID-19 first disrupted global financial markets in March 2020.

Understanding Market Drawdowns

Siyabulela Nomoyi uses a compelling analogy to explain market drawdowns: "It's almost like bungee jumping off a bridge. The peak is where you jump off, but the drawdown is equivalent to the lowest point of how far you fall. And it's very, very important to actually understand that in the context of investment risk.”

The Time vs Timing Debate

The podcast highlighted a crucial investing principle through stark examples. Looking at South African resources:

• 3-year returns: -1% per annum
• 5-year returns: +19% per annum

Looking Forward: Key Takeaways

1. Drawdowns are inevitable 
2. Time in the market beats timing the market
3. Diversification is evolving  
4. Factor investing matters - 
5. Stay educated - the retail investor boom rewards those who keep learning

Siyabulela Nomoyi Concludes

"Market volatility will always be there, and the people who are in it for the long term, while striking a nice balance in terms of diversification in their portfolio, should be all right."

The past five years have been a masterclass in market resilience and adaptation. For investors willing to learn from the lessons of this period, the foundation for long-term wealth creation remains as solid as ever.

Click here to listen.

Disclaimer

*Satrix is a division of Sanlam Investment Management

Satrix Investments (Pty) Ltd is an approved financial service provider in terms of the Financial Advisory and Intermediary Services Act, No 37 of 2002 (“FAIS”). The information above does not constitute financial advice in terms of FAIS. Consult your financial adviser before making an investment decision. While every effort has been made to ensure the reasonableness and accuracy of the information contained in this document (“the information”), the FSP, its 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 disclaim 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.

Satrix Managers (RF) (Pty) Ltd (Satrix) is a registered and approved Manager in Collective Investment Schemes in Securities and an authorised financial services provider in terms of the FAIS. Collective investment schemes are generally medium- to long-term investments. With Unit Trusts and ETFs, the investor essentially owns a “proportionate share” (in proportion to the participatory interest held in the fund) of the underlying investments held by the fund. With Unit Trusts, the investor holds participatory units issued by the fund while in the case of an ETF, the participatory interest, while issued by the fund, comprises a listed security traded on the stock exchange. ETFs are index tracking funds, registered as a Collective Investment and can be traded by any stockbroker on the stock exchange or via Investment Plans and online trading platforms. ETFs may incur additional costs due to being listed on the JSE. Past performance is not necessarily a guide to future performance and the value of investments / units may go up or down. A schedule of fees and charges, and maximum commissions are available on the Minimum Disclosure Document or upon request from the Manager. Collective investments are traded at ruling prices and can engage in borrowing and scrip lending. Should the respective portfolio engage in scrip lending, the utility percentage and related counterparties can be viewed on the ETF Minimum Disclosure Document. 

For more information, visit https://satrix.co.za/products