“I have an extra R300 that I want to invest with Satrix as a debit order. Is this the right time to invest now and which Satrix fund should I chose?” asks Stanley.

Maya replies: The world is a challenging place at the moment and we will see far more volatile returns from the stock market. This means that share price of Satrix (an exchange traded fund listed on the JSE) will increase and decrease over short periods of time.

However the power of a debit order is that when the market falls you are able to buy more units for the same rands – it is like a shop going on sale and getting a discount! In fact it is better to be investing when the markets are falling. When markets are rising it just gets more and more expensive. As this is a long term investment you should not worry about short-term market movements and only look at the value of the investment every six months to a year.

Satrix is a range of exchange traded funds listed on the JSE. They track the average return of certain indices such as the largest 40 shares on the JSE or the largest financial shares for example. Satrix Top 40 tracks the largest 40 shares on the JSE and as such has exposure to mining (resource) stocks. Many fund managers believe that our resource shares are undervalued and may increase in price.

Alternatively there is Satrix RAFI which is an enhanced index-tracking fund that takes into account a number of fundamental investment principles (cash flow, sales, dividends and book value) in constructing a portfolio of 40 stocks. It aims to invest in companies that are showing greater value relative to other companies. Over time value shares tend to outperform.