Where to invest after COVID-19

South Africa's economy has faced a significant downturn, reporting its third consecutive quarter of economic decline with a 2 per cent decrease in GDP. This decline comes amidst the global COVID-19 pandemic, which has impacted economies across the world. The economic challenges have prompted responses from both individuals and investment managers, as they navigate the changing landscape of investments and financial strategies. The recent interest rate cuts by the South Africa Reserve Bank to 3.75 per cent, the lowest in years, have created both challenges and opportunities for investors. CNBC Africa recently hosted a discussion on the impact of these changes on investment strategies post-COVID-19, featuring Busi Skenjana, Founder and CEO of Stokvel Academy, and Richard Bray, Head of Strategy and Positioning at Amplify Investment Partners. The interview touched upon various key points, shedding light on the challenges faced by the stockfell community and investment managers in the current economic climate. The stockfell community, which traditionally thrives on monthly savings, is now grappling with reduced incomes due to the economic downturn. The recent interest rate cuts have further impacted their ability to save, leading to concerns within the community about the future of their investments. Busi Skenjana emphasized the importance of helping stockfell groups shift from being mere consumers to informed investors, highlighting the need for a review of savings and investment patterns. On the other hand, Richard Bray discussed the challenges faced by investment managers in mitigating risks and optimizing portfolios for their clients. The market volatility induced by the pandemic has led to emotional decision-making among clients, with many opting to shift from riskier assets to cash holdings. Bray stressed the significance of diversification and the inclusion of alternative investments like hedge funds in portfolios to mitigate risks. Despite the market downturn, he highlighted the value of financial advice and the critical role of financial advisors in guiding clients through turbulent times. The interview also unveiled the results of a 'dipstick' survey conducted by Busi Skenjana within the stockfell community. The survey revealed alarming statistics, with around 56 percent of stockfell members unemployed at the time of the survey. Additionally, the survey highlighted the community's reliance on collective savings to purchase essential goods, underlining the need for financial education and empowerment within the stockfell groups. The survey emphasized the desire of stockfell members to learn more about budgeting, investment opportunities, and business prospects, signaling a growing interest in financial literacy and investment education. In conclusion, the discussion illustrated the challenges and opportunities present in the current economic landscape of South Africa. As individuals and investment managers navigate the complexities of post-COVID-19 investments, the need for diversified portfolios, financial advice, and education stands out as key pillars for long-term financial sustainability. The stockfell community's resilience and determination to weather the economic storm underscore the importance of empowering communities with financial knowledge and tools to make informed investment decisions.