‘Logic, evidence’ drive more SA investors to index tracking funds: Steven Nathan

Index tracking funds eclipsed actively managed funds in assets under management last year, in a significant milestone for the global investment industry. In South Africa, passive investing has been gaining traction, too, with investors increasingly becoming wise to the need to pay close attention to costs, which can eat into returns. Index tracking funds tend to carry lower fees than actively managed alternatives, which is a significant reason index trackers consistently produce higher returns. Steven Nathan, CEO of 10x Investments – whose firm only uses index funds in retirement savings products – says individuals who are retiring are increasingly doing their own homework about investment opportunities rather than relying on advice of financial intermediaries. He tells BizNews founder Alec Hogg that more people who are changing jobs and want to preserve retirement capital are also opting for index tracking funds with lower fees. – Editor