Despite some disadvantages, this type of direct forestry investment is a viable option for private investors.
London, UK (PRWEB) January 25, 2013
iNVEZZ.com released its latest analysis on forestry, explaining what the private investors’ options are when it comes to forestry investment. The article outlines several different approaches, outlining the advantages and disadvantages of each.
According to the analysis, at the outset of any forestry investment stands a basic investment decision – whether the investment is to be focused on the acquisition of real estate or the production of forestry products. The option of the two enterprises to be virtually integrated is not to be excluded, the article clarifies, pointing out that many forest owners also maintain operations such as timber mills and pulp mills.
On the subject of forest acquisition, iNVEZZ.com points out that despite some disadvantages, this type of direct forestry investment is a viable option for private investors. The positives to this approach, according to the analysis, are to be found in the long-term stability of the asset class and favorable taxation treatment. On the negative side the website states is the significant initial investment that is required to buy an area large enough to generate a considerable income and also the ongoing costs for managing the property.
That financial burden can be shared by multiple partners participating in a forestry syndicate, which is the second, “more realistic” option for direct forestry investment presented in the analysis. Such syndicates exist in a number of countries across the world, including the UK, Australia, Canada New Zealand and Brazil, the portal informs.
The last option discussed in the analysis is buying shares in listed forestry investment companies. According to the article this approach provides a viable alternative for investors seeking more liquidity. Forestry investments are usually highly illiquid but that can be circumvented by investing in forestry funds, in particular REITs and or timber-related ETFs.
The full analysis can be found at http://invezz.com/analysis/alternative-investments/forestry-investments-a-guide-to-available-mechanisms
iNVEZZ.com is a newly launched investment-focused web portal offering news and analysis on a broad range of markets and investment classes such as forex, equities, commodities, real estate and energy. The website provides accurate and timely information with up-to-the-minute updates on the latest developments in the global markets.