Mark Weetman, Vunani Private Clients, introduces you to his Autopilot Retirement Blueprint where he covers retirement life stages and investing using passive ETFs

1. The Autopilot Retirement Blueprint
Mark Weetman
Vunani Private Clients

2. "An autopilot is a system used to control the trajectory of a
vehicle without constant 'hands-on' control by a human
operator being required.
Autopilots do not replace a human operator, but assist them
in controlling the vehicle, allowing them to focus on broader
aspects of operation, such as monitoring the trajectory,
weather and systems." Wikipedia

3. Autopilot = passive building blocks
db x-trackers Euro STOXX 50
db x-trackers MSCI USA Index ETF
db x-trackers MSCI World Index ETF
Grindrod Property SAPY ETF
Grindrod Property Top Ten ETF
Grindrod S&P SA Low Volatility ETF
NewFunds eRAFI Overall ETF
NewFunds ILBI Exchange Traded Fund
NewFunds TRACI 3 Month Index Fund
RMB MidCap ETF
RMB Top 40 ETF
Standard Bank Africa Commodity Index ETN

4. Creating a diversified portfolio, the theory

5. How to create a diversified portfolio?
The key is having the right mix of shares, bonds, property and cash
This mix of asset classes is known as your “asset allocation”
Studies show that somewhere between 77 and 94% of the variability in
your portfolio's returns are determined by asset allocation
There is general agreement that asset allocation is the most difficult
part of portfolio management
"But in order to diversify correctly, you need to know what kinds of
investments to buy, how much money to put into each one, and how to
diversify within a particular investment category.“
Having a lot of investments does not necessarily make you diversified
Go for Variety, Not Quantity

6. “Ok, Mark, I understand splitting up my investment pie but what are
my options?”
The four major asset classes you typically invest in:
Cash (or cash substitutes)
•gives you and your portfolio security and stability.
•lowest risk, short-term horizon
Bonds
•brings in income
•low to medium risk
Property
•provides both a hedge against inflation and low "correlation" to shares
•medium to high risk
Equity
•helps your portfolio grow (engine house)
•high risk, long-term horizon

7. Life is always about risk and reward

8. Creating your own glide path

9. Should my portfolio change over time?
Absolutely! That's because different investment mixes are riskier than others, and your
tolerance for risk decreases as you age.
What's the best asset allocation for my age?
“Old rule of thumb, you should subtract your age from 100 - and that's the percentage of your
portfolio that you should keep in shares.”
For example, if you're 30, THEN 100 – 30 = you should keep 70% of your portfolio in shares. If
you're 70, you should keep 30% of your portfolio in shares.
However, with investors living longer and longer, having a higher risk appetite and possibly
facing a retirement funding shortfall, many financial planners are now recommending that the
rule should be closer to 110 to 115 minus your age.
That's because if you need to make your money last longer, you'll need the extra growth that
shares can provide.

12. Creating a Reg28 diversified portfolio, in practice

14. Aggressive Moderate Conservative
Domestic equities
Top40, MidCap, ERAFI, Low Vol.
International equities
World, USA, Euro STOXX
Listed property
SAPY, Top 10
Bonds
ILBI
Cash & equivalents
TRACI, Cash
Other
Commodities
27.2%
45.6% 34.9%
23.3% 18.9%
11.6%
15.5% 21.3% 21.3%
24.3%
16.0%
7.8% 13.6%
3.0%
6.5%
4.9%
4.9% 0%

15. Vunani Private Clients
mark@vunaniprivateclients.co.za
011 384 2920/1/2
Questions?