Tuesday, September 25, 2012

With all of the Massive QE, It Would be Wise to Hedge Against Inflation With "Real Assets". Consider Farmland As An Inflation Hedge - Its' Jim Rogers' Favorite Asset!

Alternative investments hedge against inflationary QE
It is by now indisputably clear that central banks globally have printed unprecedented amounts of new money through QE. So why have we not seen sky high inflation yet? The reason we haven't seen rapid price inflation is that people are still squirreling away Pounds, Euros and Dollars because they're still very worried about the prospects for the economy.  The quote below is a summary from a firm called Casey Research:

Sooner or later, the Federal Reserve, the Bank of England, and the European Central Bank will have created so much new paper fiat currency through QE that people will start to question the value of these paper fiat currencies.  At that point, the urge to buy –whether it's capital goods or consumer goods or commodities – will revive the economy, and the recession will come to an end. That will reduce the level of caution people feel to something near normal. The result will be that all of the excess money that has been created since 2008 will come pouring out. For a little while it will look like happy days are here again – the economy will seem to be booming. But then the excess cash will set off hair-curling price inflation. 
This is why GreenWorld have long argued that everyone should have at least some small portion of real assets in their portfolios - non-financial assets that have real economic value, cannot be printed and are finite in quantity.  While many run to Gold, the thing we at GreenWorld argue is that Gold pays no income and has no inherent economic value, i.e. you cannot eat it or build anything with it.  From our perspective, the best of the alternative investments is farmland.  Farmland pays regular income; it is a real, tangible asset; and it plays the macro trend of shrinking arable land and rising global population.  All that, plus legendary commodities investor Jim Rogers is a huge fan of agricultural investments as well!

To look at GreenWorld's three farmland investments in Africa, Europe or Australia, please contact us at info@greenworldbvi.com.

Thursday, September 20, 2012

How to Invest in Farmland?

The macro case for farmland investment is quite clear
Let's say you want to invest in farmland like Jim Rogers.  You may also have noticed that farmland investing has also become a huge trend among large institutional investors such as pension funds.  What would be the next steps?  As we have mentioned previously, Jim Rogers is involved with a couple of farmland investment funds, but even if you are a big fan of Jim's like we at GreenWorld are, these farmland funds are targeted at the very wealthy, with minimum investment requirements no doubt in the hundreds of thousands.

The good news is, as we have discussed previously, in just the last two years a number of options have been developed for individuals. The most common is to pool a number of individual investors' capital together to purchase a large parcel of land, and then divide it into individual freehold parcels. Farmland investments for individuals generally pay a regular yearly dividend from the sale of crops, and also provide the opportunity for long-term capital gains as farmland continues to increase in value.  

The nice thing about this approach is that it also provides retail investors direct ownership of farmland.  There is no hedge fund with its' high fees involved, nor any financial fund with stocks or loans or other risky assets.  You as the investor can own high quality farmland in emerging markets such as Africa or Eastern Europe.  Dividends so far in these projects have averaged between 10% - 16%, and the we have already seen appreciation in the value of the underlying farmland.  If you are interested to pursue these further, GreenWorld has investing options in African farmland and European farmland.  Please contact us at info@greenworldbvi.com for more information!

Wednesday, September 19, 2012

Farmland Hedge Fund Versus Direct Ownership of Farmland

Farmland - an excellent high yield investment
We recently came across some very interesting information about a London private equity firm called Emergent.  What was interesting was that Emergent has an African farmland fund.  It sounds great - BUT, the catch is that the minimum investment in this farmland fund is €500,000, which puts it off limits except to the very rich.

Luckily, however, for those "little guys" interested in investing in farmland there are now options available.  GreenWorld's African farmland project has a minimum investment of only £1,950, making it easily accessible for individuals to invest into.  Furthermore, our African farmland investment involves direct ownership of farmland, rather then being a hedge fund like that from Emergent.  Like most hedge funds, Emergent charges 2% of the assets under management plus 20% of the profits, meaning the Emergent farmland fund must produce superior returns to provide a reasonable profit.  GreenWorld's African farmland investment involves direct ownership of the land, however, and there are no other additional fees.  We may be a bit biased, but we believe our structure is better!  Feel free to read more about our farmland investment in Africa, as well as our European farmland investment - contact us at info@greenworldbvi.com to discuss further!

Wednesday, September 12, 2012

GreenWorld's Farmland Investment in Europe - High Dividend Of 10%

Invest in rich Lithuanian wheat farmland
GreenWorld is very pleased to announce that our farmland investment in the new EU country of Lithuania just paid out its' first dividend.  It was a nice, high dividend of 10%, and we expect these excellent returns to continue.

  • Farmland is a solid, relatively recession-proof asset (everyone needs to eat) that leverages the global trends of high agriculture commodity prices and shrinking arable land globally.
  • Profitable track record.
  • This NOT a new project, but rather an investment in an existing farmland with outstanding local managers and a 10 year track record of success.
  • 100% increase in farmland prices needed to raise land values in Lithuania in line with other core EU countries.
  • Fertile farmland in a Baltic state with full EU membership.
  • Many economists believe higher food prices are now unavoidable.
  • Capital growth potential from prime farmland that we believe is significantly undervalued.
  • Double-digit return prospects on working capital.
  • And, world famous commodities investor Jim Rogers is a huge proponent of farmland as an investment!
If you want to learn more our farmland investment in Europe, please contact us at info@greenworldbvi.com

Monday, September 10, 2012

Farmland Investments Justified By Continued High Food Prices

High wheat prices benefit GreenWorld's Lithuanian farmland investment
It looks like the price of wheat continues to remain high.  Just recently Egypt, the world's top importer, made its biggest order for wheat in years, agreeing to import 1.25 tonnes.  As you can see from the chart at right, wheat prices have continued to be on a strong upwards trend.

In our view, this continues to justify Jim Rogers' view that agriculture and farmland investments will be the commodity to be in for the next decade.  Luckily, GreenWorld has an excellent project for small retail investors to access that takes advantage of the high price of wheat and other grains.

This is our investment in European farmland.  Our farmland investment in Europe is located in the new EU country of Lithuania.  Prices of farmland in the new EU Baltic countries are only about half those in the neighboring Nordic countries.  This means there is substantial upside scope for capital gains in this Lithuanian investment.  On top of that, our European farmland investment is an excellent option for a high dividen d yield, as it just recently paid a dividend of 10%.  

Please contact us at info@greenworldbvi.com if you are interested in adding farmland to your investment portfolio.