GETTING STARTED
Investing in offshore investments
Your second option is to directly invest in a product
that is not rand denominated. Investments such as
these are housed offshore in countries like Mauritius
or Bermuda. The options offshore are endless;
however, investments need to suit the investor’s risk
profile and a longer-term view should be taken.
As the offshore investment is made in a foreign
currency, it means there may be exchange controls to
consider should one want to bring the money back to
South Africa. This method of investing often requires
a large lump-sum and is not very flexible when it
comes to ongoing contributions (unless the investor
can meet the high monthly deposit amount.) If the
lump-sum is not readily available, it’s also possible to
save the money locally and move it offshore once it
meets the minimum requirements.
Purchasing a property
Many South Africans are acquiring residency in
countries like Mauritius and Malta through property
investment. While residency is the goal of some,
others are considering purchasing property purely for
the diversification and attractive returns. This trend
could be attributed to how the SA property market
has been on the decline for roughly several years,
while cities like Portugal and Spain (amongst others)
continue to receive good rentals and healthy capital
again in the propertys’ value.
Background research into the property trends
prevalent in your desired country is imperative to
making informed decisions. It’s advisable to consult
with a South African company that has taken its
operations abroad. Be mindful of Capitals Gains
Tax and Estate Duty which can be explained by a
specialist in the field.
Local funds that invest offshore
This option requires one to invest in a local fund
that invests in international assets. This means the
investment will still be made in Rands but invested
into offshore products. This strategy transfers the
investment risk offshore and removes local market
risk from their investment.
SOURCES prudential.co.za, moneyweb.co.za
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