Wednesday, 22 August 2012

Forestry Investments as a Hedge Against Inflation

If you are worried about inflation and/or are interested in an asset more stable then stocks, then forestry investments are one of the ideal alternatives available.  Forestry provides an excellent inflation hedge; the demand for wood is causing increasing shortages – especially in China as the graph below demonstrates; and the performance of forestry investments are uncorrelated to financial assets like stocks.  After all, trees do not care what the latest numbers from the DOW, FTSE or Nikkei are.  

One excellent forestry investment to consider is a teak investment.  When looking at a teak investments, consider that fully mature wood is the most valuable. Peak returns for teak are usually projected at 20-25 years, which is why GreenWorld and our forestry management partner have structured our teak investment on a 25-year plan.  However, one excellent feature of our investment in teak is that our investors can exit after just 5, 10, 15 or 20 years.  The project manager will buy back your land and trees at cost+5% per annum or you have the option to sell via our established trading platform or to a third party.  This gives you the option of a GUARANTEED exit strategy, or else if you have a longer-term time frame you can hold your teak investment to maturity.  Please visit our website to learn more about GreenWorld's investment in teak.
Forestry Investments - An excellent "China Play"!