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Its time to talk about Offshore Investing

In this weeks edition of the Wallstreet Journal we unpack offshore investing

Diversification is key when you want to achieve a positive overall return over time. And as much as diversification can be done on local instruments, which include Cash, Bonds, Property and then Equity, one must also look at offshore instruments.

We live in a global society, where you can do anything from purchasing an item from the US or China to calling a relative in New Zealand.

When looking at economics, our country is and has been very resilient and our ability to bounce back has always been part of our DNA. We faced covid head on, we currently have an electricity crisis, which not only affects households, but more importantly manufacturing. From these things new enterprises have always sprung up which is what we do. We have interest rate increases that do put a bit of pressure on spenders. But the savers are going to be smiling all the way to the bank.

Looking at where we are in terms of the markets, it is a tough road ahead, but it also poses opportunity to investors. Because one must remember, money is not made when things are good and markets are running at highs, but it is in fact made when there are these dips.

Now looking at offshore, there are a few ways to go about incorporating it into your overall investment strategy.

Offshore Portfolios domiciled in rands;

This is where you invest into international portfolios which are rand based but have offshore holdings. There are a range of portfolios available with asset managers, and they are based on what your risk appetite is. Ranging from Cash instruments, to offshore equities. There are limits applied when using offshore in some of your investments. Check with your advisor what these limits are.

Direct Offshore Investments,

These investments are structured in US Dollars, Euro, or Pound Sterling. They are domiciled in your preferred currency in either Jersey, Isle of Man or Guernsey.

Each year we can transfer up to R1 million offshore per calendar year without having to obtain a Foreign Tax Clearance Certificate.

Using this allowance, you can transfer it into your international offshore investment.

Read more about foreign allowances here.

As I mentioned, when you use this investment and its invested offshore, based on your time horizon, and risk appetite, you can invest into anything from Cash all the way to Equities or a holding of various instruments.

The benefits are that you have international exposure to the best performing stocks and assets.

You have currency appreciation on your investment based on international currency.

If you would like more information about offshore investment opportunities, speak to your financial advisor or give us a call?

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