This Snowflake is anything but offended
In the year 2020, the term “snowflake” has become a commonly used derogatory term for anyone who is overly sensitive or easily offended. It’s often used with the word “triggered” which is the act of being offended. In the investment world, Snowflake has become a landmark tech Initial Public Offering (IPO) story for a number of reasons. The only thing …
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Making space for SPACs
Capital markets are fascinating. They are the arenas for gladiators to make and lose fortunes, all in the pursuit of business greatness. Traders in the stands mercilessly punish failure and support success, driving the gladiators to put everything on the line. Investors seek out the gladiators with real staying power; the ones that have figured out how to survive multiple …
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Aspen prescribes bolt-on acquisitions
Aspen Pharmacare is a R60bn pharmaceuticals giant that used to be a lot bigger. The share price is down over 57% in 5 years, reflecting an unsuccessful strategy to push into developed as well as emerging markets, all while steadily building up a debt pile. It’s a story that seems to play out over and over again: South African corporates …
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Luno pays off for Naspers and RMI
Cryptocurrency isn’t a topic you’ll read about often on The Finance Ghost. In fact, this is probably the first time I’ve written anything on it. My reasoning is simple: cryptocurrency is like religion; you either believe or you don’t. It’s not a topic for rational debate. I don’t invest in cryptocurrency because, to this day, nobody can give me a …
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The -51% GDP headline is misleading
Whoever writes the Stats SA GDP report wasn’t messing around this week. Reminiscent of Finance Minister Tito Mboweni’s rather colourful Twitter feed, the report opened with the following line: “The punch in the gut was severe.” When a governmental statistics agency writes with such emotive language, you know things are rough. The report immediately goes on to note that “perhaps …
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Beware of Robinhood
This may sound like a fairytale, but it could have an unhappy ending. Robinhood is the US stockbroking app that has driven an influx of literally millions of (particularly younger) investors who have bought American stocks on a fractional ownership basis. Fractional ownership is the same principle that Easy Equities uses locally, which allows people to invest a specific amount …
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The power of market signalling
The JSE requires companies to make certain disclosures. These range from reporting results through to alerting the market when directors and their associates buy or sell shares. There is also a need to disclose any resignations of directors. This year, there has been another interesting development: an allowance by the JSE for companies to defer the release of financial results. …
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Too many Chiefs? A lesson for start-ups
One of the core principles in designing a great racecar is to achieve a low centre of gravity. Start-ups should learn something from this. Top-heavy cars don’t handle well. The weight is all in the wrong place. At an extreme, they can topple over. There’s a reason Formula 1 cars aren’t shaped like toasters. The same principle applies to start-ups, …
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A slow but steady recovery
In case you haven’t noticed, the economy has opened up considerably. Restaurants are busy and people are finally doing things with their lives (and money) again. It’s worth touching on a couple of economic health barometers: new vehicle sales and manufacturing sentiment. New vehicle sales: do consumers have money? Bearing in mind that interest rates in South Africa are at …
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Balwin bridges the sectional title gap
Balwin Properties is one of the more interesting property companies on the JSE. Instead of being a typical property fund that owns a variety of shopping malls or office properties, Balwin develops residential estates and sells off the units. It’s primarily a gross profit model, not a rental model, although Balwin isn’t shy to rent out properties either. They’ve been …
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