Understanding market unpredictability, alert responsiveness, and the art of right timing. These are some of the key insights Savannah Cohen – who is part of a team of four students from the University of Cape Town – attributes to having been invaluable in helping them clinch top spot in the JSE Investment Challenge’s Exchange Traded Funds (ETFs) and Exchange Traded Notes (ETNs) university category for the month of May.
Their team named, INV_ Alpha Investments Ltd, comprises of Cohen, as well as Gabriël Janse van Vuuren, Mandilakhe Madubela, and Ross Morley-Jepson. They are one of six teams to win in the varying categories of the challenge.
“What I’ve learned so far in the challenge, is how quickly the market can change... I’ve also learnt that we have to be very alert and responsive to market changes, and that our decisions should not be emotionally reactive, but driven instead by a pre-planned execution price. This is what we’ve employed in our strategies,” Cohen said, a postgraduate studying BCom (Hons) Financial Analysis and Portfolio Management (FAPM).
Designed to highlight the importance of investing and to increase financial knowledge among South African school learners and tertiary students, the Investment Challenge provides high school and university participants with an opportunity to invest a virtual amount of R1 million on the stock market in actual Johannesburg Stock Exchange (JSE) listed shares over a six-month period. Their performance is tracked and measured against other competitors, with top-performers eligible for outstanding prizes after the floor closes in September.
Cohen adds that the challenge not only highlights the importance of timing their trades, but also on performing their due diligence on consistent market research and having weekly meetings with team members.
“It’s not only a timing game, but a patience game too and that means knowing when to not sell too early, or buy at a high,” Cohen says.
“As the only woman in my group, it’s been a growth experience that has empowered me with a new-found confidence in recognising my capabilities in the finance industry that I can bring into my career one day.”
Idris Seedat, Head: Transformation and CSI at the JSE says, “Every month, we are increasingly moved and impressed by the transformational impact this challenge has on students and learners. Their decision-making is becoming refined and astute, and bearing tangible fruits. Our intention as the JSE is to create an enabling environment for these future captains of industry to learn more and grow.”
The Investment Challenge is the JSE’s flagship financial literacy programme and marks its 50-year milestone of driving financial knowledge and progress among young South Africans this year.
Giving more insight on their team strategy, Morley-Jepson, a 4th, and final year Bachelor of Business Science specialising in Finance with Accounting student, adds: “From the times the markets opened till about an hour before close, our team would research and analyse which buy and sell options we’d like to make for that day. And during that hour before closing, the team would deliberate again on options to take so that we’d all be making an informed and inclusive decision.”
“Our ETF strategy was based on a risk-adverse approach, and we took advantage of market constraints caused by The Federal Reserve Bank of America’s continuous interest rate increases. And the strategy really emphasised patience, and the benefits of buying ETFs which buy you broad market exposure and mitigates risk.”
In celebration of the 50th anniversary of the Challenge, the JSE is going down memory lane by running a competition targeted at all Investment Challenge alumni. Past participants are called to share their Investment Challenge stories and stand a chance to win their share of R10 000 in investment vouchers.
Submissions need to include the year in which the entrants participated in the competition, the school or tertiary institution they were enrolled in, what was happening in the country and the markets when they participated, their team members and how the game impacted their lives and future investment decisions.
Entries can be submitted on social media by way of a 30 second video clip and tagging the Investment Challenge pages on TikTok: @jseinvestmentchallenge, Facebook @JSEChallenge, Twitter: @JSE_Challenge and Instagram: JSEChallenge. Alternatively, written submissions of no more than 500 words can be sent via email to [email protected].
Winners for the May 2023 monthly Investment Challenge competition include:
- Income Portfolio for schools: MP Unshaken Traders from Mpumelelo Secondary School, Mpumalanga
- Equity Portfolio for schools: The Proclaimers Reborn from Curro Durbanville High School, Western Cape
- Speculator portfolio for schools: CEG Settlers Investors from The Settlers High School, Western Cape
- ETF/ETN portfolio for schools: LAM-Castle Bridge 5 from Castle Bridge School, Free State
- Speculator portfolio for universities: KoffieEnBeskuit from Stellenbosch University, Western Cape
- ETF/ETN portfolio for universities: INV_ Alpha Investments Ltd from University of Cape Town, Western Cape
Teams that are still keen to participate in the Investment Challenge can still register electronically at https://schools.jse.co.za and https://university.jse.co.za. To stay updated, you can follow the competition’s social media accounts on Facebook, Twitter , Instagram and TikTok (@JSEinvestmentchallenge).