1. Shift from individual share portfolios to fund portfolios

In South Africa and abroad, there is an increasing trend of client portfolio being managed via funds as opposed to direct shares. Instead of holding a portfolio of individual shares, the trend is now to have a portfolio that consists of funds – equity funds, fixed income funds, or whatever the case may be. There may be different reasons depending on each investor’s rationale, but some of the considerations may potentially be the fact that the fund manager may trade within the fund without triggering a taxable event, but also Inheritance tax in foreign jurisdictions, as a result of situs (location of the asset)….

  1. Algorithms driving never-seen-before market movements

Whether there’s good or bad news, markets tend to be much more sensitive than what they have been before. A lot of that is driven simply by the positioning of some algorithm funds. Using supercomputers and complex algorithms that pick up on breaking news, company/stock/economic information and price and volume movements, many institutions now make trades in a matter of microseconds, through a practice known as program trading….