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Offshore Investments
Tuesday, August 1, 2000
One umbrella

In a bid to reduce the complexities of offshore Sanlam recently introduced its ‘Offshore’ series, which is aimed at the middle to higher income group.

The product effectively assembles the wide range of offshore products and investment opportunities available within the Sanlam Group under one umbrella.
Deon Lessing, marketing director of Sanlam Personal Finance, said the Offshore series was “a logical result of the success of the group’s offshore products and services and its increasing popularity amongst clients.
“In 1995 we were up front in South Africa with offshore investments and since then we have beaten all comparable investments. Owing to our commitment to better service and the focus on clients’ individual requirements, we have extended our product range. These developments have, however, had the effect that clients found it all the more difficult to make choices.
“With Sanlam Offshore we hope to overcome this problem for clients and focus anew on our business philosophy to be client-directed.”
South Africa is an upcoming market and as such, very volatile, while more established markets offer more consistent growth. The Sanlam Offshore series offers investment opportunities that not only take into account individual risk profiles, but also the financial ability of those in the middle as well as the higher income groups. Such investments offer individuals the opportunity to distribute their risk over more than one market.
Offshore investments can take place in one of two ways, in offshore currency and in rands. According to present regulations South Africans may, on approval of the SA Reserve Bank, invest up to R750 000 overseas. This amount can be converted to any other currency for purchasing offshore investments. The proceeds are paid out overseas.
A rand-dominated offshore investment makes it unnecessary to apply at the Reserve Bank. The fund manager uses the money for purchasing offshore investments by means of an asset swap with Sanlam’s offshore partner. The proceeds are paid out in rands. This method especially offers excellent access to offshore investments for newcomers to the market.
Mr Lessing says that offshore investments presented an excellent means of rand hedging. “In the past ten years the local currency has depreciated at an average rate of 6% per year as compared to the US dollar. By investing overseas, this erosion of the individual’s rand value of his investment, savings or retirement money can be delayed to a great extent.”
The opportunities offered by Sanlam Offshore for overseas investments, can also be used as an investment portfolio for a savings policy, retirement annuity, unit trust or to reinvest the proceeds of a retirement fund, whether after retirement or owing to retrenchment. Gensec International Asset Management, which is a wholly-owned subsidiary of Sanlam and a division of Gensec, manages the investment on behalf of Sanlam Offshore.
 

Copyright © Insurance Times and Investments® Vol:13.7 1st August, 2000
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