Publish Date: 07/03/2019
Building wealth through fixed income investing
Over the last three years, the returns on cash investments have averaged 7.3%, while the return on the Johannesburg Stock Exchange (‘JSE’) Top 40 index has averaged 6.3%. Gavin Jones, Group Executive for Treasury and Balance Sheet Management at African Bank, believes that a balanced approach, allocating at least a portion of your long term investments into cash products, should continue to hold future appeal for investors.
Although investment into the equity market traditionally does yield a greater return over the long term, it comes with the risk of negative growth including the possible loss of capital over the short to medium term. An investment into cash products can build wealth over the medium to long term and provide a steady and certain return over a fixed term.
Part of our strategy at African Bank, is to grow its savings and investment portfolio. We believe that the bank’s growth over the past year demonstrates the fact that African Bank is paying SA's best interest rates, with zero fees, across all of its saving and investment products, irrespective of the size of the deposit. This is a unique offering, as many banks reserve their premium rates to large deposits, such as those over R100 000.00, for example.
Using our longest dated fixed term deposit of five years, which has an annual equivalent rate of 10.75%, the following examples for investors with different cash flow needs, illustrate this point.
We believe that investors will continue to see us as an attractive and safe investment destination, ensuring you receive SA’s best interest rates.
About African Bank
Our mission is to be a successful Retail Bank offering a wide range of products and services to the consumers of South Africa. The people who work for African Bank represent the diverse population of South Africa; therefore we are a reflection of you, of all South Africans. We seek to provide value - more than our consumers expect of us. We promise to live our purpose 'humanity through banking' in all that we do and we are confident that we can, because 'We are You'.