National Savings Month: Discover Your Investment Personality

National Savings Month is important to help drive more awareness around saving and investing among South Africans. PHOTO:

National Savings Month is important to help drive more awareness around saving and investing among South Africans. PHOTO:

Published Jul 4, 2023


July is National Savings Month in South Africa, a time when we put the national spotlight on the need for South Africans to save and invest more. We have one of the lowest savings rates in the world which means many of us don’t have a financial buffer during periods of recession, high inflation or interest rate hikes. Investing is one of the best ways to make your money work harder for you – and knowing your investment personality is a crucial part of the journey to maximising your returns.

Duma Mxenge, Business Development Manager at Satrix, says, “At Satrix, our commitment lies in assisting South Africans to enhance their knowledge about investment and National Savings Month is important to help drive more awareness around saving and investing among South Africans.”

He said, "There are so many factors that impact our investment ‘personality’. For instance, upbringing can be a big factor. When I grew up, the environment was very restrictive due to the government at the time. My parents’ personalities meant that this made them extremely cautious with their finances and they had a highly conservative mindset. Children brought up with these money values tend to adopt a similar conservatism or ‘rebel’ with a more maverick mindset.”

He said there is no good or bad personality when it comes to investing. It’s just about working with your natural traits to set in place a strategy that matches who you are.

Now to the practical.

Take the quiz to uncover your investment personality and gain insights into how you can optimise your investment strategy.

How would you describe your approach to decision-making?

  1. I rely on my emotions and gut instincts.
  2. I prefer to analyse facts and data before making a decision.
  3. I tend to follow trends and go with my feelings in the moment.
  4. I trust my own research and judgement to guide my choices.

What is your attitude towards risk?

  1. I'm extremely risk-averse and prioritise the preservation of capital.
  2. I prefer lower-risk investments but can tolerate some volatility.
  3. I'm willing to take on moderate risks for potential higher returns.
  4. I'm comfortable with higher risks if it means the potential for significant gains.

How do you react to market fluctuations or unexpected events?

  1. I get anxious and tend to panic, often making impulsive decisions.
  2. I remain calm and focused, relying on my research and long-term strategy.
  3. I feel inclined to react quickly, often following the herd mentality.
  4. I assess the situation and make informed adjustments to my portfolio as needed.

What is your investment time frame?

  1. I prefer short-term investments with quick returns.
  2. I have a medium-term outlook and focus on steady growth.
  3. I enjoy exploring various investment opportunities, even if they are short-lived.
  4. I have a long-term perspective and am willing to patiently wait for returns.

How much control do you like to have over your investments?

  1. I prefer to have minimal involvement and leave it to the experts.
  2. I like to be involved but also seek professional advice.
  3. I enjoy actively managing my investments and making frequent adjustments.
  4. I have complete confidence in my abilities and prefer managing my investments independently.

Now, let's evaluate your answers and discover your investment personality:

Mostly As: Cautious Investor

You prioritise capital preservation and prefer safer investment options. Low-risk opportunities and long-term stability are more likely to be your goals, not chasing high returns. Consult with a financial adviser who can help build a diversified portfolio that aligns with your risk aversion.

Mostly Bs: Methodical Investor

You are analytical and meticulous in your approach to investing. You conduct thorough research, rely on facts, and make well-informed decisions. You are likely to favour a balanced portfolio with a mix of low to moderate risk investments, and you regularly review your strategy to stay aligned with your long-term goals.

Mostly Cs: Spontaneous Investor

You enjoy taking risks and following trends. You should be wary of making impulsive decisions and rather focus on maintaining a diversified portfolio. Consider seeking guidance from a financial adviser to help navigate the market and manage risk effectively.

Mostly Ds: Individualist Investor

You have confidence in your own research and judgement. You leverage your independence and research skills to build a portfolio that reflects your investment goals. Stay well-informed about market trends and be open to adjusting your strategy based on changing circumstances.

By understanding your investment personality and aligning your strategy accordingly, you can contribute to building a stronger savings culture and secure your financial future.

Regardless of your investment personality type, diversification is key. “Exchange-traded funds are an investment vehicle which offer affordability, simplicity, flexibility, and the ability to diversify across various asset classes, ensuring your portfolio is well-rounded.”

Mxenge says that investing is a lifelong process. “Stay informed, continue learning, and adapt your strategy as market conditions evolve. With the right knowledge and self-awareness, you can make significant strides towards achieving your financial goals.”