His investing career started at the age of 11, when he bought three shares for $38 each in a company called Cities Service Preferred on the stock market. He’d go on to sell those shares for a $6 profit. Today, Warren Buffet is 90 years old and considered one of the most successful investors in the world.
But it’s 2021 and investing is not just for the Warren Buffets of the world. Capitec, in partnership with EasyEquities, has made investing simple and accessible to everyone, no matter your age or financial experience.
When you download the new Capitec banking app and activate the EasyEquities widget, you’ll be able to invest securely from anywhere, at any time. You can start investing immediately from as little as R5 and, as a Capitec client, you’ll save 20% on the commission you would pay when you make an investment. Already have an existing EasyEquities profile? It’s simple and secure to link to it on the Capitec banking app.
No investment experience? No problem!
It’s completely understandable if you’re wary of investing your hard-earned money on the stock market, especially when you have zero experience. Fortunately, the new Capitec banking app gives you access to the EasyEquities’ widget, which has a demo account allowing you to practice.
As a new user, you’ll get a demo account with a balance of R100 000, which you can use to play around on the Johannesburg Stock Exchange. This will allow you to get a feel for how markets perform while monitoring your profits and losses without the risk of losing any real money. You can also try your hand at the US markets by investing the $10 000 in your demo account.
Once you have a better understanding of how the stock market works, you can use your own money to invest for real. And the best part? You can start investing from as little as R5.
Simplify your life
Capitec client Afuah Asare-Baah, a 21-year-old accounting student from the Eastern Cape, had been thinking about investing for some time but didn’t want to go through the hassle of finding an affordable broker. “Since EasyEquities was already on my Capitec banking app, I thought it would be more convenient to just use it instead,” she says. “I also realised that the investing fees were a lot cheaper. The fact that it’s associated with Capitec also gave me the impression that it is a reliable platform.”
“EasyEquities is easy and safe to use. The Capitec app already has good security measures in place so I don’t have to worry about someone accessing my investments fraudulently.”
Diversify, diversify, diversify
Although she has no experience with investing, Afuah used the knowledge she acquired as an accounting student to help her choose the best investments. “You need to do a lot of research before investing in a company,” says Afuah. “Don’t just follow your gut. And never put all your eggs in one basket!”
She’s not wrong. Diversification is one of the simplest ways to boost your investment returns while reducing your overall risk. In fact, the Nobel prize-winning economist Harry Markowitz once said, “Diversification is the only free lunch in investing.”
When you diversify your investment portfolio, you reduce your overall risk while increasing your potential for overall investment growth and returns. Some of the time some assets will perform well, and others won’t, but a year from now, their positions might very well be reversed.
Invest for the long term
Another important factor in successful investing is that it has to be for the long term. Historically, shares typically produce positive returns over longer periods of time that can offset the short-term risks. If you can, hold on to your investment for at least 10 years.
In his 1989 book One Up on Wall Street, Peter Lynch, a highly successful portfolio manager, wrote, "If I'd bothered to ask myself, 'How can this stock possibly go higher?' I would never have bought Subaru after it had already gone up twentyfold. But I checked the fundamentals, realized that Subaru was still cheap, bought the stock, and made sevenfold after that."
In essence, what he’s saying is this: you should consider investing based on future potential instead of past performance. Although large short-term profits are tempting when you’re new to investing, experts all agree that investing for the long term is essential to greater returns and success.
Simplify your life. Invest with EasyEquities
Use the Capitec banking app and get access to investing in shares through the EasyEquities widget. Investing made simple, convenient and affordable.
*This EasyEquities user story does not constitute financial advice. The user was also given an EasyEquities voucher for their participation.
