Chart of the month: 5 Largest stocks dominate
Geo Botha • October 3, 2025
In this month’s chart we can see that over the last 60 years, top five stocks now make up nearly 35% of the US market — the highest concentration on record. They include: Nvidia, Microsoft, Apple , Alphabet (Google) and Amazon.
Market leadership is becoming increasingly narrow, leaving investors more exposed if these giants stumble.
At Bovest we take this into consideration when constructing our client’s portfolios and it serves as a reminder of the risks of concentration and the value of diversification.
Although almost every investor will have exposure to these large tech companies in one way or another, it is important to limit the level of exposure and not get caught into investing in themes or falling in love with a certain stock.
At a recent event, hosted by pour partners at Ninety-One asset managers, many of the talks still revolved around the impact of AI, not only in the workplace, but investment opportunities as well. This boasts the idea that these stock might still have room to grow, but at a certain point valuations move across the tipping point, and we will see a correction in prices.
Kindly contact our team if you have any questions.
In many instances, spouses choose to bequeath their whole estate to each other and the surviving spouse will look after the children. This is also good estate planning. But what will happen to the children and assets should both parents pass away? Underage children can inherit these assets but should be managed through a testamentary trust. A short video summary of the below can be watched here: https://www.instagram.com/reel/DPOqkx3DP1S/?utm_source=ig_web_copy_link&igsh=MzRlODBiNWFlZA== What Is a Testamentary Trust? A testamentary trust is a legal entity created in terms of a person’s Will, which only comes into effect upon their death. Unlike inter vivos trusts, it is not operational during the testator’s lifetime. The Will serves as the trust instrument, and the testator is the founder. How Is It Created? Drafting the Will: The Will must clearly state the intention to create a trust, name the beneficiaries, identify the assets to be placed in trust, and outline the terms and conditions. Activation: Upon death, the nominated trustees apply to the Master of the High Court for Letters of Authority to manage the trust. Trustees: It’s advisable to appoint at least one independent trustee with fiduciary expertise to ensure proper governance. Why Should Clients Consider It? Protection for Minor Children: Minors cannot legally inherit until age 18. A testamentary trust ensures their inheritance is managed responsibly until they reach maturity. Special Needs Planning: A Type A Special Trust offers tax-efficient support for beneficiaries with disabilities. Asset Preservation: Prevents reckless spending by beneficiaries. Trustees manage and distribute assets according to the testator’s wishes. Managing Indivisible Assets: Useful for assets like farms or holiday homes that cannot be easily split among heirs. Tax Efficiency: Testamentary trusts may offer tax advantages, especially in the case of special trusts. Important Considerations Validity of the Will: If the Will is invalid, the trust cannot be established. Professional drafting is essential. Trustee Selection: Trustees must be trustworthy, capable, and ideally include an independent party to avoid conflicts. Costs & Complexity: Testamentary trusts involve legal and administrative costs. Clients should be made aware of ongoing compliance and management responsibilities. Family Dynamics: Clear communication and transparency in the Will can help prevent disputes among beneficiaries. Contact me at ruvan@bovest.co.za for more information. Ruvan J Grobler RFP™ (PGDip Financial Planning)
For a long time, the South African Reserve Bank (SARB) prohibited money from being transferred directly from local trusts to offshore trusts. You may have had offshore exposure in your local trust through asset swops and other investment vehicles, but if you want to distribute to overseas beneficiaries, you must first withdraw funds from the trust and then transfer to them through the SARB. This recently changed. SARS declared that beginning August 1, 2023, it will evaluate and possibly approve petitions to transfer funds from South African trusts to offshore trusts. This adjustment coincides with the South African Reserve Bank's (SARB) recent relaxation of several currency control regulations. While this new alternative provides numerous prospects, there are tight criteria and a thorough application process. If you are an investor or trustee, you must understand these requirements. There is certainly no one-size-fits-all answer, and the drawbacks and benefits should be examined while deciding. Drawbacks: 1. Complex Regulatory Requirements. • Strict compliance required: The procedure is extensive, necessitating meticulous documentation and adherence to both SARS and SARB regulations. • Long approval process: Each application is assessed individually, which can take weeks or even months. 2. Cost • Legal, tax, and accounting assistance can be costly. • Administrative burden: Extensive documentation and regular reporting increase management time and expenses. 3. Tax obligations • The South African trust must pay all relevant taxes (capital gains, dividends, etc.) before distribution, preventing tax deferral to the recipient. Money held in a trust is often taxed at a higher rate than money held in the name of a company or individual. 4. Uncertainty and Evolving Practice • New regulations may impact future distributions and compliance needs. • Disputes: Failure to meet SARS or SARB rules may result in delayed or refused distributions. Benefits: 1. Global Wealth Diversification. Offshore trusts may provide superior asset protection during political or economic volatility in South Africa. 2. Succession and Estate Planning • Multi-Jurisdictional Estate Planning: This allows families with members living in different countries to structure their affairs more efficiently. • Offshore trusts facilitate the transfer of money to beneficiaries outside South Africa, simplifying inheritance processes. 3. Tax preparation • Offshore trusts can optimise worldwide tax positions with proper preparation and professional counsel, but must follow all applicable requirements. 4. Regulatory Clarity • Official Approval: SARS and SARB now provide clear protocols for trustees and investors, eliminating legal risks. The ability to transfer money from a South African trust to an offshore trust is a useful tool for global estate and investment planning. Professional guidance is essential to maximise benefits and avoid pitfalls.
