Satrix - people still using them?

I wouldn't do it that way.

10 of the FINI shares are already replicated in the DIVI and you just increase your exposure to the same companies, you will be exposed to 35 companies in total.

A better spread of good dividend paying companies would be the DIVI and RAFI together. You'll get a spread of 61 different shares(there are 73, but 12 are duplicated, which isn't a bad thing, just means you hold more of good dividend paying shares) and if one sector does badly (say financial) you are in more other sectors than that, thus spreading the risk.

So personally I would do R1500 DIVI and R1500 RAFI or R2000 DIVI and R1000 RAFI
 
ocleroux said:
mmmm kay...I just dont want to spread it so thinly though. It is only R3000.00.
Click to expand...

Understandable - and again this is only my opinion - but you don't want to "play" Satrix, especially as a medium to longterm investment. You are mitigating risk by diversifying, so spreading is a benefit. (Although it has been shown that the marginal benefits of diversifying quickly diminishes after a certain point)

Nonetheless, in terms of what Satrix is and the typical investment horizon, exposure to the whole Top 40 makes sense.
 
SiriS said:
(Although it has been shown that the marginal benefits of diversifying quickly diminishes after a certain point)
Click to expand...
Good point, but then why bother diversifying above Satrix 40 then? I vaguely recall that after ~20 shares the benefits drop to near zero, so Satrix _40_ should in itself be fine, no?

I suppose it would depend on the degree of correlation though.
 
Well...took the plunge. Submitted my application to them about 10 minutes ago via email.

R2000.00 DIVI
R1000.00 Top 40

What happens now? Do they contact me or what is supposed to happen? I assume I must wait for something to happen before I can register on their website to log in?
 
ocleroux said:
Ah ok....cool.

I WANT MY SMS NOW! ME WANTS THE INTEREST! MY PRECIOUS!!!!!!!! :mad:
Click to expand...

Interest?? It's called dividends :p

And you will only get dividends every 3 months. Hopefully you have ticked the reinvest returns box... and it gets reinvested anyway if its under R100 (which your first and second and maybe third ones will probably be). Remember, this is a slow but steady process, like erosion. Time in the market...
 
czc said:
So how does this actually work? How do stocks make money.
Click to expand...

Probably a subject for another thread. However in short, the share price is determined by supply and demand. The more demand for a particular share, the more people will be willing to pay for it, which will inflate its price (make you money if you bought it a lower price).
Demand for a particular share is driven by company performance, market sentiment and other economic factors.
 
Ecco said:
Probably a subject for another thread. However in short, the share price is determined by supply and demand. The more demand for a particular share, the more people will be willing to pay for it, which will inflate its price (make you money if you bought it a lower price).
Demand for a particular share is driven by company performance, market sentiment and other economic factors.
Click to expand...

This is how I understand it also...but with Satrix...does it not work with the dividends that the companies by to the shareholders?
 
ocleroux said:
This is how I understand it also...but with Satrix...does it not work with the dividends that the companies by to the shareholders?
Click to expand...

When you buy satrix shares you buy a group of shares in a basket. What goes in the basket is determined by different things. Top40 are the top 40 shares by market cap. Satrix divi is the group of shares that are expected to pay the best normal dividends during the year. The dividend payments also have an impact on share price.
 
HavocXphere said:
Good point, but then why bother diversifying above Satrix 40 then? I vaguely recall that after ~20 shares the benefits drop to near zero, so Satrix _40_ should in itself be fine, no?

I suppose it would depend on the degree of correlation though.
Click to expand...

True, Satrix 40 probably gives you sufficient diversity for long-term. Would be interesting to see correlation stats for different funds. Divi will should obviously have lower correlation vs other funds in the way it is picked.
 
czc said:
So how does this actually work? How do stocks make money.
Click to expand...

When you buy shares in companies you own a bit of them. They pay out a dividend (from company profits) per share for to the company "owners", so the more shares you have the bigger your slice of the profits.

You can loose money if you buy shares and they become less in demand and then sell them. If you dont sell them you don't concrete the loss and the share price might go up later again, also you can make money if you buy a share and it raises in value and you then sell it.
 
supersunbird said:
When you buy shares in companies you own a bit of them. They pay out a dividend (from company profits) per share for to the company "owners", so the more shares you have the bigger your slice of the profits.

You can loose money if you buy shares and they become less in demand and then sell them. If you dont sell them you don't concrete the loss and the share price might go up later again, also you can make money if you buy a share and it raises in value and you then sell it.
Click to expand...

From my experience (my portfolio is nothing to brag about) dividends hardly amount to much. To really see growth from dividends you need to invest a lot into a company, anything under 50k is going to be measly. (I welcome recommendations on where to put my money where really healthy dividends have been paid out)
 
Ecco said:
From my experience (my portfolio is nothing to brag about) dividends hardly amount to much. To really see growth from dividends you need to invest a lot into a company, anything under 50k is going to be measly. (I welcome recommendations on where to put my money where really healthy dividends have been paid out)
Click to expand...
Ideally one would combine dividends & capital growth into one growth measure so that one can compare stocks.
 
You guys are investing in Micky Mouse shares here.
 
You must log in or register to reply here.
Back
Top
Sign up to the MyBroadband newsletter
X