Why equities offer the best value for long term investors

The future is looking good for Bryan Stewart, Sales Consultant at EasyEquities, who shares how his confidence in the equity market has grown since his first ETF purchase, and why he thinks equities offer the best value for long term investors.

Are you financially fit? Like most people, I had not spent much time contemplating this question. That was until a few years ago when, after a few convincing conversations over drinks with mates, I started investing in a few Exchange Traded Funds (ETFs). I’d been looking for a way to fund my travel dreams and this seemed like a decent shot. ETF’s offer exposure to local equities and the Satrix40 was, at the time, by far the easiest way to have a diversified portfolio with low costs. On that basis it was a real no-brainer - I filled out the paper work and setup a monthly debit order.

As you can see from the image below, the growth since inception of this ETF portfolio has been 822.98% or 15.33% annualised, pretty much destroying any other type of asset class in performance. This really defined my confidence in the equity market.

The old rational that playing it safe in reaction to past crises to secure a better outlook for retirement, has not deterred me from focusing on achieving most of my long term financial goals through equity investments. The reality is investors who allocate too much of their retirement portfolio to cash or money market accounts will likely lose out on the higher gains that equities have historically generated over long-term periods and they’ll also lose out on the compounded value of those gains between now and their future.

In short, you want to be on the right of the above diagram, invested in a well-structured, diversified portfolio over different countries and sectors, building your personal wealth. If we couple this with the new Tax-Free Savings Accounts launched in March of last year and low cost platforms like EasyEquities – retirement and the future is looking quite good!

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