Don’t wait for SA to get its house in order, invest in tech
Problem is, the JSE is an ‘old economy’ market, populated by outdated and unfashionable businesses
If you’re feeling poorer, it’s probably because you are poorer. Maybe not in rand terms, but certainly in dollar terms. If you had invested $100 in the FTSE JSE All-Share Index on February 12 2015 it would be worth $86 today, a loss of $14 over the five-year period. If you had invested $100 in the US S&P500 Index over the same time it would be worth $161, a profit of $61. The difference in return between the two markets is a massive $75, or 87%.
That our government has robbed us of electricity, vital for powering industrial growth, that officials in charge of our state institutions have siphoned-off billions of taxpayers’ money to fund their extravagant lifestyles, and that our exalted corporate gods have squandered mountains of shareholder funds on ill-conceived acquisitions are only part of the reason why the JSE is so impoverished.
The prime reason is that the JSE is an “old economy” market, populated by outdated and unfashionable businesses. Outside of major interests held by Naspers (https://www.sharenet.co.za/v3/quickshare.php?scode=NPN) and Prosus (https://www.sharenet.co.za/v3/quickshare.php?scode=PRX) in Hong Kong-listed Tencent, an internet and entertainment conglomerate, the JSE is short of companies at the forefront of technological advancement. We have gold, platinum and iron ore miners, plenty of banks and insurers, and corporations that sell beer, cigarettes and expensive watches, but no outfits engaged in the development of innovative products aimed at serving contemporary society...