Invest like a pro, even if you’re just starting out

Published on 2nd June, 2025 at 10:30 am

Investing isn’t just for stockbrokers, finance gurus, or those guys in fancy suits; it’s for everyone. Equipped with the right knowledge and tools, a solid goal, and as little as R10 per month, you could be on your way to investing like a pro. We speak with Duma Mxenge, Head of Business and Market Development at Satrix, to get the lowdown on investing for beginners.

Reading time: 4 minutes

In this article, you’ll learn:

• What to consider before you start investing.
• Understanding ‘return on investment’ (ROI).
• What is considered ‘good’ ROI.

We all want to unlock greater financial confidence and freedom, but the truth is, if you’ve got little or no experience, the world of investing can be quite daunting. Duma Mxenge, Head of Business and Market Development at Satrix, says there’s no reason to feel that it’s scary, though; you just need to know where to start.

Here are Mxenge’s five key guidelines for new investors:

1. Start with what you can manage. “Even R10 per month is a start,” he says, “and over time, that small amount can grow until you are ready to invest more”.
2. Learn how the stock market works. “Understanding basic terms and how economic shifts impact the market will give you confidence and insights to manage your investment,” he explains.
3. Have a plan and timeline. “Clear goals help you stay the course, even during market ups and downs.”
4. Diversify your portfolio. “Diversity is important. Spread your investments across different asset classes (property, shares, bonds, cash) to reduce risk.”
5. Always be willing to learn. “Markets change, so your best defence is knowledge. Stay up to date with news, articles, and any other resources you can find.”

Read more: How to start investing with R10.

What is ROI?

ROI stands for Return on Investment. It’s the percentage of profit you make on your investment over a specific time. There’s a formula to help you figure this out:

ROI = (Final value including dividends and interest – Initial value) ÷ Initial value × 100

For example:

Let’s say you invest R10 000 in a fund, and it grows to R11 500 in one year (remember, growth isn’t always guaranteed in a single year, but more on that further down).

This means that your gain is R1 500.

So, your ROI is: (R11 500 – R10 000) ÷ R10 000 x 100 = 15%

What does ‘good’ ROI look like?

‘Good’ depends on several factors, like how long you’re investing for and how much risk you’re willing to take.

Here’s a general guide to help you categorise different investment types. Mxenge outlines that there are three types of return levels depending on the risk you’re willing to take on.

Remember: The above figures are averages and should be seen as long-term indicators. Especially when it comes to medium- and high-risk investments, returns can fluctuate from year to year, sometimes even resulting in temporary negative returns during tougher economic periods. The key is to stay invested for the long haul, as markets typically recover over time. Mxenge recommends focusing on long-term returns. For example, Satrix index tracking equity funds have historically delivered an average of 8 – 13%* per year over the last decade (though this can vary depending on the index and economy).

*Source: Satrix, 31 March 2025

Real-life ROI examples

1. Rental property ROI

Say you buy a two-bedroom flat in Johannesburg for R600 000** and rent it at R6 000 per month. That’s R72,000 per year in rental income. Your yearly costs (bond repayments, levies, maintenance) are R48 000. Net gain = R72,000 – R48,000 = R24,000. Thus, your ROI = (R24 000 ÷ R600 000) × 100 = 4%

The verdict:

4% is reasonable for property, but you can improve it by raising the rent or buying in a high-growth area.

2. Rental property ROI

Let’s say you buy a bachelor flat for R200 000** in a smaller town but rent it out for R6 000 per month. That’s R72,000 per year in rental income. Let’s say your yearly costs are R36 000. Net gain = R72 000 – R36 000 = R36 000 Thus, your ROI = (R36 000 ÷ R200 000) × 100 = 18%

The verdict:

That’s an excellent return! These kinds of opportunities are rare, but possible with careful planning and location scouting.

**These two examples assume you paid for the property in full. If you used a bond and only paid a deposit, your actual ROI on your invested capital (called return on equity or ROE) could be significantly higher.

Read more: Your home-buying glossary

3. Equity/stock market ROI example

Let’s say you invest R10 000 in the Satrix Top 40 ETF, which tracks the top 40 companies on the Johannesburg Stock Exchange. Over 20 years, it has averaged around 13% per year. After a year, your investment grows to R11 300. Thus, your ROI = (R1 300 ÷ R10 000) × 100 = 13%

The verdict:

A strong return. But remember, equity investments can fluctuate in the short term, so it’s best to commit for at least five to seven years.

Where to invest?

You can invest easily, with just a few clicks:

• Satrix: perfect for beginners, great for diversified investments through index tracking funds (both ETFs and unit trusts)
• EasyEquities: also perfect for beginners, offers Satrix ETFs and unit trusts, and additional options like individual stocks, crypto and property investments.

Last thoughts

“Curiosity and a willingness to learn are the two greatest attributes needed to master investing on your own,” concludes Mxenge. “Don’t be afraid to ask questions, seek help from your financial adviser, and leverage learnings from free and online resources. These are your assets, and it’s your responsibility to make the right decisions to live with financial confidence, now and in the future.”

Satrix is a division of Sanlam Investment Management

Satrix Managers (RF) (Pty) Ltd is an approved financial service provider in terms of the Financial Advisory and Intermediary Services Act, No 37 of 2002 (“FAIS”). The information above does not constitute financial advice in terms of FAIS. Consult your financial adviser before making an investment decision. While every effort has been made to ensure the reasonableness and accuracy of the information contained in this document (“the information”), the FSP, its shareholders, subsidiaries, clients, agents, officers and employees do not make any representations or warranties regarding the accuracy or suitability of the information and shall not be held responsible and disclaim all liability for any loss, liability and damage whatsoever suffered as a result of or which may be attributable, directly or indirectly, to any use of or reliance upon the information.

Satrix Managers (RF) (Pty) Ltd (Satrix) is a registered and approved Manager in Collective Investment Schemes in Securities. Collective investment schemes are generally medium- to long-term investments. With Unit Trusts and ETFs, the investor essentially owns a “proportionate share” (in proportion to the participatory interest held in the fund) of the underlying investments held by the fund. With Unit Trusts, the investor holds participatory units issued by the fund while in the case of an ETF, the participatory interest, while issued by the fund, comprises a listed security traded on the stock exchange. ETFs are index tracking funds, registered as a Collective Investment and can be traded by any stockbroker on the stock exchange or via Investment Plans and online trading platforms. ETFs may incur additional costs due to being listed on the JSE. Past performance is not necessarily a guide to future performance and the value of investments / units may go up or down. A schedule of fees and charges, and maximum commissions are available on the Minimum Disclosure Document or upon request from the Manager. Collective investments are traded at ruling prices and can engage in borrowing and scrip lending. Should the respective portfolio engage in scrip lending, the utility percentage and related counterparties can be viewed on the ETF Minimum Disclosure Document. A fund of funds portfolio is a portfolio that invests in portfolios of collective investment schemes that levy their own charges, which could result in a higher fee structure for the fund of funds. International investments or investments in foreign securities could be accompanied by additional risks such as potential constraints on liquidity and repatriation of funds, macroeconomic risk, political risk, foreign exchange risk, tax risk, settlement risk as well as potential limitations on the availability of market information.

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