Over a week ago I ran an interesting poll on this website asking visitors what they felt the minimum return (in excess of prime - currently 10%) on the JSE was that they required in order for them to justify taking the risk and investing.

Below is the final results of the poll, and it is interesting:

The fact that the vast majority of people require 10% excess of prime returns from the JSE was quite astounding to me. With a 20% (10% prime + 10% excess) return you would more than double your money every 5 years and increase the initial amount over five times every 10 years.

A little research, though, shows that Allan Gray's (pure) Equity Fund returned 23%pa over the 10 years ...so, perhaps visitors market expectations are actually relatively well-founded.  Either that or Allan Gray's iconic status in our local equity market has set a form of a benchmark for expected returns.

Either way, it is interesting.

What is also interesting is that the second most popular excess return category was 5%, or exactly half of the most expected minimum return of 10%.  The difference between returns of 15%pa compounded and 20%pa compounded are quite dramatic...

Overall, a very interesting poll.

Vote in my next poll here concerning "Would you ever consider investing in venture capital?"

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