Smart investing: Investec’s Clarity platform simplifies global market access

Nowadays, thanks to the pervasiveness of social media and influencers, together with the proliferation of AI and financial content, investors have near-infinite information.

But it’s not this alone that is driving the explosion in retail investing.

Tinus Rautenbach, business head of Clarity by Investec, contends that it is simplicity and the ease of access that is behind this growth.

“Access to investing and trading has become much easier as digital has evolved,” he says. “People can now access the market or their investment accounts online 24/7, on their phone in an app.”

And, says Rautenbach, the “cost of having access to all this data about markets and shares has effectively dropped to zero”.

Importantly, one should not automatically assume that all that information is accurate or even good.

Now, more than ever, it is important to use data that you can trust.

This is particularly true given that there tends to be an increasing amount of hype and ‘noise’ on platforms including Reddit, TikTok and even Facebook and Instagram.

One can see that often a lot of interest and even trading behaviour is being driven by influencers. Sometimes, though, it is difficult to make a causal link.

Rautenbach says Investec has seen a lot of activity on the Clarity platform in Sasol since the start of the conflict in the Middle East.

“Now, is that because there were a lot of influencers talking about oil or was it people seeing the oil price move and therefore trading Sasol was the right way to express that view?”

As much as AI is disrupting the world, Rautenbach says it can be a “real enabler for someone starting to engage with financial services, especially if one uses it to explain products or how one option or company compares to another”.

“Don’t ask it: ‘Should I buy Apple today?’ Rather, you could ask it to explain how a change in interest rates might impact your investment in Apple, or ‘Please explain to me why Apple’s share price was down 10% on Friday?’.”

Investec’s Clarity platform

Clarity by Investec provides access to a range of investment products, including listed exchange-traded funds (ETFs) offering diversified exposure to local and global markets.

Investors can explore the available options through the platform.

These provide useful entry points to the market, says Rautenbach.

During onboarding, investors are presented with a few questions that help figure out how experienced they are. Access to more complex products, such as contracts for difference (CFDs), is subject to this assessment. CFDs allow traders to speculate on the price movements of underlying assets without owning those assets and can result in gains or losses.

This clear and transparent way of guiding users through the platform, as well as intuitive tools, real-time market access and a simplified trading experience, ensures they can make more informed decisions with confidence.

Core to Clarity’s philosophy is simplicity.

Rautenbach says the platform is designed to cater for everyone – from a beginner to an experienced trader.

“We keep the interface as intuitive and as simplified as possible but not oversimplified. Simplicity and clarity in what you’re buying is important.”

He says it is vital for investors to have their basic financial needs, such as savings and a rainy-day fund, covered first. Once that is dealt with, one can start thinking about investing for the long term and put in place various objectives.

“You’re going to look for a return that’s perhaps CPI [inflation] plus 5%, a general equity unit trust target,” he says.

“You can express that view in many ways. You can build your own portfolio that’s diversified, or you can buy ETFs, but the core idea is that you’re buying and holding, and you’re in it for the long run.”

Investing vs trading

Along with diversification, understanding exactly what you’re investing in through research helps build confidence over time.

Also important is the cost of the instruments that one uses to express that view as this plays a role in your investment returns, says Rautenbach.

Because Clarity is a unified platform, it makes it simple to trade, save and invest in one place.

Rautenbach highlights the distinction between investing and trading – but across both worlds, those who are most successful are those who “first have a plan”.

“With trading, there’s a certain amount of discipline needed around understanding why you’ve entered into a trade.”

Along with this is quantifying your risk parameters.

Rautenbach says there are three important things to consider when trading.

You need to know when you are wrong. “Using tools such as stop-loss orders is critical – can the platform you’re using provide you with an automated stop-loss capability?”
You also need to know when you’re right. “At what level are you going to take profit?” he asks, because at that point your thesis has played out. This should also be automated.
You need to establish what percentage of your capital you are willing to put towards an idea or a trade. “Trade sizing is very important.”

He stresses that in both investing and trading, one may get it wrong sometimes, but with discipline and a clear strategy, you will be successful over the long run.

Click here to learn more about Clarity and start trading.

Disclaimer:

Clarity by Investec is a service offering of Investec Bank Limited (registration number 1969/004763/06), an authorised Financial Services Provider (FSP 11750) and Over-the-Counter Derivatives Provider, a Registered Credit Provider (NCRCP 9), and a member of the JSE Limited. Investec Bank Limited is committed to the Code of Banking Practice. Complaints may be referred to the National Financial Ombud Scheme South Africa, an independent body that handles complaints against South African financial institutions. Copies of the Code and the Ombudsman’s details are available on request or visit Investec COBP.

Brought to you by Clarity by Investec.

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