A recent report in Zacks Investment Research said that recent figures suggest that 2012 could be the year that the construction industry grows again. This is great news for those who own trees or have cash invested in to timber-based exchange traded funds, who have been hanging on to their assets in recent years. Many investors would have avoided selling their timber assets over the past couple of years due to the slowing demand in the construction industry. As a result, their trees will be even larger now and will be worth more as a result.
“This is the great selling point for timber investments,”
The report by Zacks also claims that forestry has an extremely low correlation with traditional asset classes and therefore, provides an extremely effective way to diversify a portfolio. FRA claims that more and more investors are turning to alternative asset classes, such as timber, to help them to spread the risk within their investment portfolio.
Zacks' report talks about direct investment routes, such as through plantation schemes like the one run by Greenwood Management in Brazil, where investors buy up pieces of plantation land and receive returns based on the cyclical sale of timber assets. It also talked about investing in funds that are based on timber, which can offer a slightly more risky option for those interested in putting some of their cash in forestry.
About Forestry Research Associates
Forestry Research Associates is a research and advisory consultancy that focuses on forestry management, sustainability issues and forestry investment around the globe.
Forestry Research Associates
620 Vineyard Lane
Bainbridge Island, WA 98110
Tel: (206) 316 8394