How you can invest on the JSE
Learn more about the exchange so you can teach your children about investing from a young age
Johannesburg, 29 March 2017: It’s Global Money Week, a week aimed at inspiring children and the youth to learn about money, saving and investing, amongst other things. This year’s theme is ‘Earn. Save. Learn.’
South Africa is known to be a nation of people who tend to over-spend rather than save. Collectively, our debt levels are very high. To curb this, it is important that we educate ourselves and our children about the importance of saving and investing.
One of the common barriers to investing is a lack of financial knowledge and understanding of financial products. Mpho Ledwaba, Head of Marketing at the JSE, says, “It is our intention to support and improve South Africa’s culture of savings by providing investment products and educating South Africans about investing.”
Did you know that the stock exchange is a way for ordinary South Africans to save and invest and that you can invest on the Johannesburg Stock Exchange (JSE) through a tax-free savings account (TFSA) for as little as R300 per month?
Investing on the JSE is for everyone, young or old, and it’s easy. Here are three easy steps on how to go about it.
Step one: Learn about the stock exchange
The first step is to get a good understanding of what the JSE is all about.
To get in-depth knowledge about the running of the exchange and the different products, the JSE has online learning modules
which are ideal for getting this knowledge from the comfort of your own home. In addition, the JSE also facilitates Power Hour sessions which are targeted at investors who are either already investing or would like to invest in the JSE, but also looking to improve their knowledge of financial markets.
To help the youth learn about investing in a fun way, the JSE also runs the annual JSE Investment Challenge
, an online virtual game intended to increase understanding about financial markets amongst high school learners and tertiary students.
Step two: Speak to a stock broker about your investment goals
A JSE stockbroker can help you to understand your investment risks and benefits, giving you peace of mind.
“Our brokers have been carefully selected to guide investors along their investment and savings journey, by providing them with information and personalised financial advice,” says Ledwaba.
The JSE has a variety of products which can help you reach your investment goals. One of these is a tax-free savings account (TFSA). A TFSA is an account that provides tax benefits for investing, and the JSE TFSA provides investors with a way to invest in Exchange Traded Funds (ETFs). ETFs are ideal for first-time investors looking to invest in the stock market as they provide a ‘basket’ of JSE-listed stocks/shares by tracking a particular stock market index, such as the FTSE JSE Top 40.
There is no tax on interest earned in a TFSA and no dividend withholding tax. Investors in a TFSA are allowed to invest up to R33 000 annually, and limited to a R500 000 lifetime contribution. Investors can choose to either contribute monthly or as a once-off lump sum depending on their preferences (limits apply).
Step three: Invest
The final stage once you have spoken to your stockbroker and have made a decision is to get in the game and invest.
ABOUT THE JSE
The Johannesburg Stock Exchange is based in South Africa where it has operated as a market place for the trading of financial products for 130 years. It connects buyers and sellers in equity, derivative and debt markets. The JSE is one of the top 20 exchanges in the world in terms of market capitalisation and is a member of the World Federation of Exchanges (WFE). The JSE offers a fully electronic, efficient, secure market with world class regulation, trading and clearing systems, settlement assurance and risk management.
Media and Internal Communications Manager
Tel: +27 011 520 7495
H+K Strategies South Africa:
Tel: +27 11 463 2198