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NAVIGATING THE WORLD OF OFFSHORE INVESTMENTS
By Renee Eagar, Certified Financial Planner® Brenthurst Wealth Management
POTENTIAL INVESTORS MUST CONSIDER WHERE THEY ARE IN THEIR LIFE STAGE, THEIR FINANCIAL GOALS AND THEIR APPETITE FOR RISK.
Investing offshore has a certain romance to it. It is something that is often talked about as if it is not within the reach of normal South Africans. This mystique leads to many questions that we are asked by investors, such as the correct timing of the investment, the long-term objective, and how it fits the investor’s risk profile are just a few issues to consider.
The best time to take money offshore is dependent largely on currency volatility. The South African rand is one of the more volatile currencies and currency fluctuations can hit investors hard. The rand versus the US Dollar is currently trading around R13.84, in February 2016 it was at R15.87.
If inflation is entirely disregarded, the rand has shown a deterioration of 5.81% per annum against the USD over a 5 year period, 7.35% per annum over a period of 7 years and 6.92% per annum over the last 10 years.
As long as you are not caught up in the extremes of currency volatility it is an appropriate time to invest offshore. You want a fair value for your rand. The view going forward is that this trend is likely to continue.
When constructing an offshore strategy, it is very important to take long-term view, 5 to 7 years and more. The reason for this is that exchange con-trols and red tape need to be navigated. Offshore investing can also be lumpy and more volatile, hence a long term view is critical.
In South Africa, if you are investing locally, chances are your unit trust will have exposure to Naspers, as well as other well-known companies such as MTN, Sasol, FirstRand. If local funds are all investing in these companies, then surely that means that there are opportunities in not investing in these companies?
By investing offshore, you are opening your portfolio to the tens of thousands of companies that may have absolutely zero contact with South Africa. The opportunities that are available in many ways dwarf the somewhat limited options locally. Keep in mind the South Africa’s GDP is less than 1% of Global GDP, so by not considering overseas options you are limiting your investments to less than 1% of what the world is producing.
It does need to be said that the desire to invest offshore should not be the deciding factor in taking money overseas. Potential investors need to look at where they are in their life stage, what their financial goals are, and what their appetite for risk is. Everyone is unique, and as such, every investment plan needs to be unique. Offshore investing needs to be structured and diverse and needs to be structured into a long-term view.
If you look at the underlying asset allocation of portfolios that make up your retirement annuity or your pension fund, you may see that there is an amount allocated to offshore, or global assets. It is advisable to take full advantage of this. According to Regulation 28, which governs such funds, you may only have 30% exposed offshore and this should be taken full advantage of in full.
OTHER ADVANTAGES TO INVESTING OFFSHORE ARE:
- It protects local purchasing power (in SA 1/3rd of goods are imported, so cars, technology, clothes etc. are overpriced to rand users).
- Gaining more exposure to themes and geographies not available to SA investors.
- Investing in joint names can reduce Estate Duty.
- Direct offshore investors have access to accumulation funds that roll up your dividend, therefore more tax effective.
- Offshore investing cannot be excluded from diversification point of view and it would be unwise to exclude it from your investment portfolio, regardless of what happens locally in SA.
Brenthurst Wealth Management has been advocating a healthy exposure to foreign markets to local investors for more than 8 years now and it continues to be a cornerstone of our investment strategy.
CONSULT ANY OF BRENTHURST’S FOURTEEN HIGHLY-QUALIFIED INVESTMENT ADVISORS WHO CAN ASSIST YOU IN CREATING A TRULY GLOBAL INVESTMENT PORTFOLIO
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Megan joined the Brenthurst Wealth team in March 2026 as an Administrative and Fiduciary Services Assistant at our Val de Vie Office in the Western Cape. Prior to joining Brenthurst, Megan gained three years of experience in the retail sector, where she developed management and client service skills.
I obtained my National Diploma in Financial Information Systems from the Cape Peninsula University of Technology in 1999 and have worked in the wealth management industry since January 2000. Over the years, I have gained extensive experience in various roles, including Portfolio Manager Assistant, Planner Assistant, and Paraplanner.
Esmarelda Isaacs-Andreas joined the Brenthurst Wealth Stellenbosch office in October 2025, taking on the dual role of Receptionist and Fiduciary Administrator.
I obtained my National Diploma in Financial Information Systems from the Cape Peninsula University of Technology in 1999 and have worked in the wealth management industry since January 2000. Over the years, I have gained extensive experience in various roles, including Portfolio Manager Assistant, Planner Assistant, and Paraplanner.
Ashley joined Brenthurst Wealth in January 2025 as Office Administrative Assistant and Receptionist for the Stellenbosch Office.
René Heystek joined Brenthurst Wealth in November 2023, as receptionist and administrative assistant in the newly established George/Garden Route office.
Michelle Heystek has built a career in the financial services over the last two decades, after obtaining her B.Com degree in Financial Management in 2005. Once she joined Brenthurst in 2006, she continued her academic journey, obtaining her Certificate in Wealth Management from INSETA in 2007, followed by a Postgraduate Diploma in Financial Planning from the University of the Free State. In 2008, she earned the Certified Financial Planner (CFP®) designation.
Anelle joined Brenthurst Wealth as a Receptionist and Administrative Assistant to Brian Butchart in the Cape Town office in December 2023. She has a wealth of knowledge from working as a liaison between Financial Advisers and clients at TMA and Absa Investment Management Services (Aims) since 1998. She obtained her B. com degree from the University of Port Elizabeth in 1997.
ADMITTED ATTORNEY | FINANCIAL PLANNER & HEAD OF BRENTHURST FOURWAYS
Sanet was appointed in April 2020, joining our Cape Town team as an Executive Administration Assistant to Renee Eagar. She has been in the financial services industry since 1990. Her previous experience includes positions at Sanlam, BJM and ABSA. She spent her last 12 years working at Alexander Forbes Private Client Wealth as a Senior Wealth Management Assistant. She has received numerous accolades over the years which include but not limited to, Alexander Forbes Client Service Excellence – Silver award in 2014,2015 and 2017. Sanet has also obtained her Certificate in Wealth Management (NQF 5) in 2012 and achieved “Best Student of the Year” from Moonstone.
Maria Smit is a Certified Financial Planner® with over 10 years of experience in the financial planning industry.
