It’s 2017, and investors have headed into new territory, where the landscape is dominated by matters concerning a fairly controversial and outspoken US president-elect and the imminent, equally controversial ‘Brexit’ – to name but two global New Year challenges.
Already, the financial pages have thrown their hats into the ring with forecasts and projections aplenty regarding how the stock market, bonds, equities, inflation and various central banks will react. It’s like pantomime season all over again.
Some things don’t change though, and forestry and timberland investors remain, overall, unfazed by the high drama currently being played out in the media.
The world economy has engaged in many battles over the past few years and global financial markets have responded with a repeated – and unsettling – pattern of volatility.
Yet forestry assets stand out as the exception to the rule, providing a strong and reliable alternative investment option to private investors as well as institutional investors. The message is clear; more and more investors are exploring ways of diversifying their portfolios and are adding forestry and wood products as a means of protection against the market uncertainty that threatens the performance of their investments.
Forestry and timberland caters for a wide range of investors, including those looking to invest for steady returns or long-term low volatility; amongst the many benefits of using this asset class for portfolio diversification is its market neutral status. Returns have no correlation to market or interest rate fluctuations, stock market performance and the volatility mentioned previously.
The forecast for 2017 is for investors to continue to seek a safe haven for their money, with more European and global investors becoming increasingly interested in forestry-specific opportunities than ever before, especially sustainably managed projects.
Ultimately, the best reason to invest in well-managed forestry products is simple – trees grow, they are harvested at the right moment and continue to grow again, year after year.
In comparison to any other asset class, the built-in yield of forestry and timberland makes it an out-and-out winner for investors.