“At odd and unpredictable times, we cling in fright to the past” – Isaac Asimov
While I pen this newsletter in the light created from the office generator there is no doubt, we live in both odd and unpredictable times that we may not have imagined a decade ago. Throw in some populist leaders of the developed world who are set on unravelling the gains of globalization, and you certainly have interesting times to be a wealth manager or investor.
So much has changed in South Africa, and if we consider the lowest levels of business confidence ever were recorded this year, it is little surprise people nostalgically compare where we are to the recent past. The anger, sadness and disappointment of the prospects the once rainbow nation promised, seem so far in the rear-view mirror. Despite this South Africans are a resilient bunch. Being resilient does not mean putting your head in the sand and just taking what is dished out. It means doing the best with the hand we are currently being dealt.
This is epitomized in our dealings with our clients over the past year where conversation has moved to relying on real advice beyond that of picking a few funds. The past year has seen our ability come to the fore with our expertise to advise on optimal offshore solutions, Citizenships by investment and a variety of alternative products that provide protection and certainty in these unpredictable times. It is amazing to see how South Africans love their country despite what is going on, however they realize now more than ever how important it is to create and preserve their wealth in real terms. Needs and the wealth landscape are changing and through our technology and constant search for new opportunities we are staying at the forefront to provide our clients with the best outcomes possible. This was a contributing factor to why we won best Wealth Manager in Africa at the last Euromoney SRP awards.
Despite the tough conditions and negative sentiment, Harbour Wealth has had another good year of growth and has delivered returns beyond what we would have predicted at the beginning of 2019. With our local growth index solution delivering 18.4%, and our Offshore growth solution delivering 22.4% in USD as at the end of November 2019. Consider this while the costs (Total Expense Ratio and CAT II Fee) of these portfolios have been 0.48% and 0.61% p.a. respectively. Our ability to constantly deliver excellent returns is a function of our robust processes, experience and an excellent team. Couple this with costs that are a third of the industry average in a time when each percentage point counts. This results in the outcomes we have committed to delivering to our clients.
I realize how tough it is as a client to watch the volatility of the past few years and I thank you for trusting and listening to our advice to stay the course. Having clients that trust and allow us to advise them when in many cases we know the fear they are experiencing; is the biggest compliment we receive each day. I would like to assure you we never take you for granted and work hard every day to ensure that your trust is not misplaced. We realize that while to many its just money, to us it reflects the sacrifices each of you have made or are making to provide the security and future that you have dreamt of for you and your family.
We expect next year to again offer challenges along with opportunities. A possible credit downgrade is on the horizon, and while disappointing, this may actually have some interesting unintended consequences of seeing bonds spike to higher yields, in turn becoming more attractive to global investors. In addition, with Trump trying to retain the presidency, he will need to have a strong economy; hence we suspect he will do all he can to provide this.
As you hopefully get to take some time off at the end of what has been a tough year for many, we would like to wish you a happy holiday and festive season. We would also like to thank you for your continued support. While these times may continue to be odd and unpredictable, we will do all we can to ensure you keep getting the best outcomes and have the financial peace of mind to be able to focus on doing what you do to make 2020 your year.
As we approach a new year and a new decade, please feel free to contact one of our qualified independent Financial Advisors for advice and guidance on all your financial planning needs: www.harbourwealth.co.za.