If you believe the art and science of asking questions is the source of all knowledge, then you have arrived at the right page and the right investment partner. Whether you are at the start of your investment journey or in charge of an institutional fund, below you will find answers to frequently asked questions. 


  • What is a bear market?

    When share prices are falling and there is general negative sentiment it is called a bear market. Warren Buffet will tell you this is when the smart and the brave, look for bargains.

  • What is a bull market?

    When share prices are rising or are expected to rise, it is called a bull market. Generally (in the long term), the bulls will more than make up for losses experienced in bear times. The long game is always the better one.

  • I'm new to investing; when is a good time to start?

    The sooner you start the better. Time is a valuable source of diversification and investment time – and allows you to be more aggressive with your investment choices early on. Higher risk = higher reward.

  • Do I have to invest a fixed monthly premium over a set period of time?

    Unit Trusts do not require fixed payments over any given period. You decide when, how much and how you want to go about growing your invested capital. However, consistency and discipline do tend to yield better results. 

  • What is an annuity?

    An annuity is an investment that converts a lump sum (your pension fund for example) into regular income – which is taxable.

  • Explain capital gains tax

    When you sell a capital asset such as stock, the profit you make on that is called 'capital gains' and that is subject to taxation.

Personal investments

  • What is an investment strategy?

    Planning for retirement involves setting of investment goals. To give yourself the best chance of achieving those goals you need a strategy that is appropriate for you, today. Your appetite for risk, desired returns and available time are the cornerstone of investing.

  • Why plan for retirement?

    Most of us will spend 20 to 30 years in retirement. These years need to be funded by 40 to 45 years of work. Given the uncertainties of life and rising living costs, it is important that we maximise all opportunities of building sufficient capital.

  • How much is enough?

    That depends on what type of living standards you look to maintain, however, a general rule requires a replacement value of between 70% and 80%. This means that every R1 000 you earn should be replaced by (at least) R700 of income from your retirement capital. If you retire at 65 with an annual salary of R500 000 and need 80% of that to live for another 25 years, you will need R8 million in capital at retirement.

  • How much do I need to save?

    To accumulate enough capital to last during retirement, your monthly contributions need to be as high as possible and maintained throughout your economically active years. Start at 10% of your final salary and work your way up from there. Not always easy, but absolutely critical.

  • I’m looking to save for a specific goal (education, holiday, other). What do I do?

    Absa has several products to suit this type of investment. View our products and services or contact your adviser for more assistance. 

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