It's time for South Africans to invest with their heads, not their hearts. We are advising our clients to invest as much of their money as they can elsewhere in the world. We do not see a single reason why people should keep any discretionary investable funds in this country.
People should keep their house and their pension as their only assets here if they live in South Africa. But the rest should be invested in hard currency assets that will protect their buying power, which has already been deeply eroded.
South Africa is now in its longest downward business cycle since the end of World War II and the performance of its assets continues to reflect this unfortunate reality.
The rand has lost a third of its value against the US dollar in the past five years and remains under pressure. Investors in South African equities have lagged developed markets, while house prices have increased at less than half the rate of inflation for several years.