The JSE and finance forum for South Africa
General Category => Shares => Topic started by: jaDEB on January 15, 2014, 02:33:35 pm
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What do u clever people think the Rant is going to do....
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10.92
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It's interesting how pessimistic most South Africans are on the Rand and this is reflected in most of the daily trade you see with importers wanting to hedge and protect against any Rand weakness whilst exporters are less worried about hedging because they don't think the Rand will strengthen. So of course the flow of trade supports further Rand weakness in a self-fulfilling prophecy.
However, in recent years the Rand has performed spectacularly well and if you had off-shored a lot of Rands you would be questioning the returns. SA is unfortunately lumped together with the other emerging markets with thinly traded currencies and most of the FX traders are sitting off-shore with a limited insight into what is going right with SA, alongside all the negative news. I would recommend JP Landman's new book, "The Long View" to anyone with an interest in SA.
And short term I think the Rand will hit 11.00 and then strengthen back to around 10.80 for a bit. Currently it's quite overbought although the 11.00 level is too exciting to traders to not get there now. Ego's are at work.
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forward curve mentioned NRD ETF (New Rand ETF)
Their top holdings include SAB,CFR,NPN,APN,MND ect. i.e. Rand hedges.
I just wonder why they have performed so poorly when compared to the ALSI let alone
the Rand hedge stocks in their portfolio ?
See image....
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I transferred an amount in Rands a few weeks ago to an account in the IOM which was converted into GBP's and I lost R14000 on the transfer so told my broker to hold the Sterling and let's see where the Rand is going and right now if I change it to Rands (as I have a Rand acc with my broker) it would turn it into a R15000 gain! So in effect it would be a R29k swing but where do you see the Rand going? Is it going to get even weaker or should I cash in now?
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I am no expert, but I think it will stabilze here, and recover a bit. As I say, I am not an expert.
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Old article from 5 Sep 2013 but still relevant:
Mohammed Nalla, head of strategic research at Nedbank Capital, said: "South Africa’s equity markets are expected to correct in the short term and underperform in both rand and dollar terms." Barclays still expects the rand to weaken to about R10.80/$ when tapering starts, though technical analysis shows R9.50/$ as fair value.
05 SEPTEMBER 2013, 06:26
http://www.bdlive.co.za/business/2013/09/05/dual-listed-companies-confound-rand-critics
Currently 10.97
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Can one of you smart people tell me in plain English what the effect on this weak Rand and the interest rate hike will be on ETFs like Top40 and MidCap. I assume I need not worry over the long term?
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Depending on what you consider long term. SA has large current account deficit, political issues, domestic unrest/strikes and SA Forward Rate Agreements (FRAs) due in 12 months jumped almost 7% yesterday, suggestive that rates could go up by as much as 200 basis points this year. Unfortunately I'm no expert in this field; maybe others with more scope can elaborate.
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If you take the results of the poll above, turn the pic 90 degrees, the rand actually gives you the answer.
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:(
Long term as in I have no plans to use any of that money anytime soon. Just extra money I put away each month.
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:whistle: -- oohhh getting stronger R10.71
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It's been a while since any posts on this subject so where do you think the Rand is headed with all that's going on?
I'm reading things like it's going up to R16/$ in the next three years! God help us if that's the case!
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Yeah, we are truly stuffed, especially when factoring in that gold mining will more or less cease in 4/5 years. All those unskilled workers jobless with no hope of employment (unless they are made to work the land a là kibbutz).
On the local market I would only consider Rand hedges like SAB which incidentally may be swallowed by Anheuser Busch, which would be very good as Anheuser have better margins than SAB, plus they would get SAB's emerging market exposure.
Of course long term the Rand will weaken i.e. it certainly won't break its very long term nasty downward trend.
11/11.30 by year end.
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Take a look at this monthly chart of the USD:ZAR. Look at the points where the Rand started to strengthen each time i.e. April 2009 etc..... Now tell me if you're that certain of impending Rand weakness..... Markets are strange and they always move to hurt the most people most of the time. Are you one of the herd? Is the herd right this time, or are we seeing the emergence of the strength of emerging markets again....?
Bonds are screwed. Stock markets are WAY overvalued.... Where can international investors get some decent returns because this thing called QE is not going away anytime soon. Hey, there's this country called SA where interest rates are actually pretty decent and it has a liquid currency market.... Get ready for some more hot money flows!
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Are returns better here than in other countries?It seems inflation erodes allot of profits here.Also,my understanding is that the stocks are also overvalued here.
Am I on the right path,or missing anything?