Is modern investing as simple as selecting a few stocks or ETFs?

Résumé détaillé

Queen Mahachi from Citadel explains why access to investments isn't the same as financial advice, and where professional advisors add real value.

SIMON BROWN: I’m chatting with Queen Mahachi, advisor at Citadel. Queen, appreciate the time.

A piece that you put out recently has certainly got me thinking. You talk around ‘access is not advice’. I suppose let’s start. The JSE has what, over 140 ETFs, R260-odd billion.

Almost anyone can build a portfolio these days, frankly, on their phone. This is a good thing – but maybe not a good thing. There is certainly a worry. It might create a false sense of security – and that’s certainly a point you were making strongly in your article.

QUEEN MAHACHI: Yes, definitely. Hi Simon, thank you for having me. I’m both positive and cautious on it. I think on the one hand it has introduced a new wave of investors who are a lot more aware that they can have access to these things, but who also know how the markets work, in a sense.

It does create that illusion that investing is as simple as putting a few stocks together or a few ETFs together – and there you go.

The reality is there’s a lot of risk management involved, infrastructure – and I think the big thing for us at Citadel is that financial planning has to be incorporated with tax planning, estate planning, risk planning, and then also really knowing the client and understanding their needs. This is because a lot of us as people have bias as the reason we make decisions.

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That can’t easily be picked up by either a language model or an AI tool that we are engaging with. So really that relationship with an advisor is paramount for that.

SIMON BROWN: I get your point, and that line that you draw there is that distinction between the creating of wealth and then the preserving of the wealth.

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