ABOUT RAND MERCHANT INVESTMENT
📊 Rand Merchant Investment Holdings Ltd., also referred to as RMI Holdings, is a listed financial services investment holding company incorporated and registered in South Africa on March 24, 2010 as a wholly-owned subsidiary of RMB Holdings. RMB Holdings (RMBH), Remgro, and FirstRand span off their insurance assets to RMI Holdings on March 7, 2011. RMI Holdings shares were listed separately on the Johannesburg Stock Exchange (JSE) although the company shares the same management team with RMB Holdings. RMI Holdings has a market capitalization of about R60 billion and the company’s share prices performs very well indeed. The company trades on the JSE under the stock symbol “RMI”.
📊 The company holds and extensive portfolio of insurance products in South Africa, Australia, China, Mauritius, New Zealand, Singapore, Ireland, the United Kingdom and the United States. The company’s objective is to grow shareholder value over the long term – through attractive dividend yield and an increase in intrinsic value.
📊 In a strategic move to diversify its traditional service offerings, RMI Holdings decide to buy into asset management through RMI Investment Managers. It purchased significant stakes in Discovery (25%), Merchant Capital (25%) and OUTsurance (84%). The company also plans to buy into next generation businesses in the fintech sector. To this end it has established AlphaCode, an innovative financial services platform for various role players to develop the fintech industry.
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HISTORY OF MERCHANT INVESTMENT
- Rising inflation, interest rate cycle and muted GDP growth in South Africa negatively impacted on the company’s performance in the 2016 fiscal year. The group recorded a 8% increase in normalized earnings (R3.3 billion). Although Discovery Health, Discovery Life and Discovery Investment showed increased performance, overall growth was stifled by a 73% increase in investments in new initiatives. Merchant Capital also continued its strong performance amid investments in core operations and product development.
- Although the company registered disappointing data due to low underwriting profits, muted equity investment growth and operational challenges, OUTsurance continued on its upward growth path with 43% increase in normalized earnings due to improved contributions from the Youi Group and good operational results in South Africa.
- Rand Merchant Investment Holdings latest offering, RMI Investment Managers, offers a unique affiliate investment manager model which is based on investment in – and partnership with – independent investment managers and specialist investment teams. The company’s first year of operations comprised of activities such as the establishment of a distribution and operations team, establishing a corporate structure and finalizing regulatory approvals. The company’s focus, going forward, is investment in next generation businesses, which is expected to stimulate growth and increase profits, adding value for its investors.
MARKET PERFORMANCE OF RAND MERCHANT INVESTMENT
- Rand Merchant Investment Holdings share price performs impressively on the JSE with the live online stock chart registering a rise from R22.35 in 2013 to over R40 in October 2016. The shares have, however dipped recently due to a stifled economic climate in South Africa.
- Rand Merchant Investment Holdings has, nevertheless, proved itself as a perennially solid contender in the financials market, and therefore company shares are still a lucrative investment. Shareholders who buy or sell RMI Holdings shares can do so in the expectation of satisfactory dividends and returns on their investment.
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Before buying any stock or share one has to consider a few factors.
STEP 1: PROPER RESEARCH IS ESSENTIAL
Upon deciding you want to buy RAND MERCHANT INVESTMENT Stocks / Shares, it is critical for the serious investor to do proper research into the said company. Its values should align with those of the investor’s current portfolio. An investor needs to familiarise himself with the basics and history of the company, as well as its leadership and performance in the market. Its company reports should also be scrutinized.
Consultation with a brokerage firm can also assist in determining whether investing in a specific company will complement the investor’s current portfolio. The investment “risk ladder”, which identifies asset classes based on their relative riskiness, is another useful tool when determining which company’s stock / share is the best to buy.
STEP 2: CALCULATE THE AMOUNT OF INVESTMENT IN RAND MERCHANT INVESTMENT STOCKS / SHARES
It is important for an investor to monitor his total investment in stock in order to keep his portfolio aligned to his investment strategy. The overall value of his holdings will change with the fluctuation in stock prices, which can throw his portfolio off balance. To determine the amount to invest, multiply the number of shares of each stock by its current market price to determine the total investment in that specific stock. For example, if you own 100 shares of a $5 stock, multiply 100 by $5 to get $500.
STEP 3: DECIDE ON THE STOCK / SHARE ORDER TYPE
Investors can choose from a market order, a limit order, a stop order (also referred to as a stop-loss order) or a buy/sell stop order. It is important to familiarise yourself with each type’s pros and cons before deciding which one will suit your current stock profile best. An investor should be guided in this choice by his investment objective.
STEP 4: OPEN A BROKERAGE ACCOUNT
A brokerage account – also known as taxable investment account – is similar to a retirement account, but more flexible. Where a retirement account has limitations on the amount of money that can be contributed annually, and restrictions on when funds can be withdrawn, a brokerage account is more flexible. The latter has no income or contribution limit and the investor can withdraw his money at any given time. This flexibility, together with its potential investment gains, makes a brokerage account more attractive to serious investors. Brokerage accounts are ideal for goals or savings that are further than five years away, but closer than retirement. It can also supplement an investor’s emergency savings.
STEP 5: COMMIT AND PURCHASE RAND MERCHANT INVESTMENT STOCKS / SHARES
Lastly, commit to the stock. Pro Tip: Monitor the value of your stock to ensure you have a growing stock value and dividend pay-out. Regularly check the share price online to ensure your investment delivers a positive return on investment. You are now a proud owner of RAND MERCHANT INVESTMENT stocks / shares.
5 Questions to ask yourself before purchasing any stocks or shares.
- Is it the best time to buy this stock / share?
- Should I buy RAND MERCHANT INVESTMENT stocks / shares in the current economic climate?
- Can I afford to buy this stock / share?
- What is the forecast of the stock / share growth?
- What is the current price per earning ration on the stock / share?
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