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Simon’s weekly wrap: New, innovative investment options on the horizon

This week MoneywebNOW looked at rand strength off the back of the US election, insights into the Ant Group, the JSE’s expectant new investment options, investing in litigation for a return, and much more.
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Americans voted in the US elections on Tuesday, but by Friday morning results were still being counted, with Joe Biden seemingly the likely victor. This expected victory has seen the global market storming higher. This has also seen our rand trading stronger at 15.71/US$. Andre Cilliers of Treasury One commented that we are seeing a bit of a risk on trade globally, with money moving into emerging markets. But he cautions that South Africa has significant challenges and any rand strength may be short lived.

The Ant Group IPO has been cancelled, but Anchor Capital’s Henry Biddlecombe believes it is an amazing conglomerate of fintech businesses. It has a personal loan book larger than American banks and the largest money market mutual fund in China. Nobody is sure when, or if, the IPO will return but Biddlecombe commented that he easily got to a valuation for the Ant Group which is twice that of the IPO price, so this is one to watch out for.

In his Medium-Term Budget Policy Statement speech last week, Finance Minister Tito Mboweni stated that exchange controls would be further relaxed, and I spoke to the JSE’s Valdene Reddy about these changes. The big one is allowing trade on the JSE in foreign currency, but also potential changes to Regulation 28 as the inward listing rule is removed. Looking ahead she mentioned that we’ll almost certainly see a range of new and very different products being listed on the JSE that will offer investors a much wider range of investment options.

I also spoke to Taurus Capital founder Simon Kuper on launching an R80 million litigation fund that essentially views litigation as an asset that can be invested in for a return. Everybody has a right to appeal to the courts, but not every person or company is able to fund such an appeal; the fund would then provide money for lawyers and the like taking a percentage of damages awarded if the appeal is successful.

Also this week:

Petri Redelinghuys of Herenya Capital talks about the Nasdaq and Sasol. Standard Bank’s Wendy Dobson reports on climate risks to the bank’s operations and lending book. Ciaran Ryan discusses the newly-launched Moneyweb Crypto.

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