Words of wisdom from expert investors
We asked leaders in the finance industry for the most valuable nuggets of investment wisdom they've received from the important people in their lives. Here's what they had to say.
Asking business and finance gurus for investment advice they follow themselves is like asking your dentist what toothpaste brand they use at home. Glean some insight from these valuable opinions to make the most of your investment goals (compiled by Hanna Ziady and first published in the 2018 Purple edition of the Wanted magazine).
The best advice I have received was from my parents, who told me that getting the best education you can afford is the best investment you can make.
- Nicky Newton-King, CEO, Johannesburg Stock Exchange
"Give clients what they need, not what they want," is something Allan Gray said at our first meeting in 2002. I was then an analyst at the firm, and this piece of advice remains with me. As custodians of clients' capital, we should concern ourselves with investing according to our convictions and not what is currently popular, conventionally acceptable, or easier to defend to clients in the short term.
- Delphine Govender, co-founder and chief investment officer, Perpetua
Saving and investing are habits that should be established as early as possible. My parents were instrumental in developing this. My first savings exercise was placing the 50c spending money I received from my grandparents on a monthly basis with the Post Office in the late '70s, and having it recorded in a savings book, which I guarded with my life.
- Anton Pillay, CEO, Coronation
Supposedly, Albert Einstein said that the most powerful force in the universe is compound interest. Therefore, avoid debt and hold onto equity.
- Adrian Gore, chief executive, Discovery
I grew up in a society that attaches undue importance to people who own expensive cars. So it was instructive, at 22 years old, to receive counsel from a mentor to buy a house instead and drive a smaller car.
- Lesiba Mothata, executive chief economist, Alexander Forbes Investments
As an avid reader, the best advice I've received is from people I've never met. One of my favourites is from Benjamin Graham, known as the father of value investing: 'You are neither right nor wrong because the crowd disagrees with you. You are right because your data and reasoning are right."
- Jean Pierre Verster, equity portfolio manager, Fairtree Capital
The best return you will ever receive is the one you get by betting on yourself. I learned that from Mzi Khumalo, who was the majority shareholder of African Harvest while I was the CEO. I have always invested in businesses I have started, and have never been scared to borrow to back myself.
- Magda Wierzycka, CEO, Sygnia
On managing my personal money I follow the advice of author Mark Twain, which is: "Put all your eggs in one basket, and then watch that basket!" As a leader of an investment firm, I follow the advice of Thabo Dloti, former Liberty CEO: "Invest alongside your clients and eat your own cooking."
- Derrick Msibi, CEO, Stanlib
Never invest in anything that you don't understand, particularly when the investment returns seem too good to be true. This was advice from Paul Harris, co-founder of FirstRand, shortly after the 2008 financial crisis.
- Basani Maluleke, CEO designate, African Bank
Never trust anyone who says, "Trust me."
- David Shapiro, deputy chairman, Sasfin Securities
From Richard Russell's Dow Theory Letters, which I read when I started my career in investments more than 30 years ago: "The combination of compounding and time is the most powerful investment tool you will ever have, but they don't work without
patience." From Peter Lynch, fund manager at Fidelity and the author of One Up On Wall Street, which I believe to be mandatory reading for stock pickers: Understand the importance of diversification and simplicity. Successful investing takes prudence and time, not intellectual genius. Applying these principles calmly in an uncertain world is the hard part."
- Anet Ahern, CEO, PSG Asset Management
When I was young, my grandmother told me that quality always trumps quantity, be it in terms of investing in yourself, investing in art, or entering the equities market. Although having diversified exposure is crucial, always make sure you buy the best you can afford at the time. Less is more.
- Margaret Nienaber, CEO, Standard Bank Wealth
This article is meant only as information. For tailored financial advice, please contact your financial adviser.
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