Investment Articles

Anyone who reads the news or goes to the grocery store these days would surely be aware of the skyrocketing cost of food globally. In a world where global population is predicted to climb from 7 billion to 10 billion people by 2050, and it will be an increasing challenge to feed this growing number of human beings.

One of the major reasons for the challenge the world faces around food security is the shrinking amount of arable farmland globally. According to the United Nations Food and Agriculture Organization (FAO), the amount of arable farmland per person globally was approximately 9 hectares in 1960. Its is currently approximately 2.5 hectares per person and will drop below 2 hectares per person by 2030 and the global population continues to grow.

China is now facing this problem of shrinking arable farmland. To take a more specific example of this trend, China currently contains 20% of the world’s population, but only 7% of its arable farmland. Within the broader Chinese economy, investment in farmland has been shrinking, with farmland frequently plowed under to make way for new factories and real estate development.

According to a report from agricultural consultancy Colvin and Co., the Chinese government estimates they need to maintain 120 million hectares for crop production until 2020 in order to be self-sufficient in grain production. Bank of America estimates that China’s arable farmland has already fallen below the 120 million hectare threshold and could decrease to 117 million hectares by 2015.

Already, China is becoming a net importer of food. According to a report from the US Grains Council, China will import some 1.7 million tons of corn this year, 5.8 million tons next year and as much as 15 million tons in 2014-2015. This makes China’s food security dependent on outside countries, a situation which makes the ruling Communist Party extremely nervous.

The point here is not to get bogged down in facts and figures, but to have investors think about the big picture. From the investing perspective, China’sUS$3.1 trillion of reserves ensures that when China wants or needs something, it is able to go out and buys it. Food and farmland are no exception. China has responded to the issue of food security by making increasing numbers of agriculture investments outside its borders, and Chinese global farmland investing will likely only continue to grow in the future. Just as one example, Chinese state-owned agriculture enterprises have been making huge investments in Australia, as well as in South America and Africa.

How to play the Chinese agricultural interest in purchasing farmland as well as the broader macro-economic perspective of shrinking arable farmland globally? Simple economic principles of supply and demand dictate that when there is an increasing shortage of an asset combined with growing demand for it, the prices of that asset are likely to go up. Savvy investors can track the locations of China’s global land investments, and then look at opportunities for investment in farmland in the same locations. Just as an example, Sub-Saharan Africa holds 60% of the world’s remaining uncultivated land suitable for farming and has seen a particular surge of interest from both Chinese state-owned companies as well as Persian Gulf Sovereign wealth funds, reflecting these nations’ concerns for their food security. Pension funds are also diversifying into African agricultural farmland investments.

Farmland investment has historically been dominated by larger institutions, but in just the last two years a number of options have been developed for individual investors. These farmland investments for individuals generally pay regular yearly income from the sale of crops such as rice or wheat, and depending on the location the underlying land itself can also increase substantially in value. Retail investors are generally able to see their individual parcels, or else the project originator may actually sell its entire project, thereby allowing the individual small investors the opportunity to share in the upside capital gains that result.

Whilst an alternative investment such as farmland should constitute only a small portion of an individual’s total portfolio, farmland is one of the more investing intriguing options for accessing both China’s growth and the challenges its economy faces going forward.

The advantages of farmland investments are substantial. Agricultural farmland investment are an excellent way to benefit from global commodity price increases which have trended steadily upwards in the last decade. In addition, farmland is also an excellent hedge against inflation. GreenWorld offers three farmland investments:

For UK investors, all of GreenWorld’s farmland investments are SIPP-eligible.

Short term trading refers to any trading strategy, in the stock or futures markets, where the duration between trade entry and exit ranges between a few days and a few weeks. Although this form of trading can be very lucrative, it is also very risky. Therefore, in order to be successful when trading in this term length, you must understand the benefits and challenges of what you’re doing. Knowing how to spot good trading opportunities isn’t enough: You must also learn how to protect yourself from unforeseen events.

One of the main benefits of short term swing trading is the fact that your capital is only at risk for short periods of time. Therefore, if you make the wrong decision on a trade, you will know it within a few days or weeks. This gives you the opportunity to free up your capital for new, high quality opportunities. In addition to the short period of risk, trading in the near term has lower capital requirements than long term trading which often requires a sizable amount of capital.

When trading like this, the expected risk/reward profile of a trade can easily be determined. This is because in swing trading, the profit targets and the risk are both well defined. With such clarity and consistency, it is easy to plan where you will exit the trade and the maximum amount of time you plan to spend in the trade. Last among the benefits, is the ability to use “bracket orders,” which enable you to place entry orders, stop losses and profit-taking limit orders simultaneously?

Short term trading is not without its disadvantages. To begin with, trading in the short term is expensive. This is due to the high trading costs which are brought about by the short holding period and the frequent trade entries and exits. In addition, risk management in short term swing trading can be quite challenging. Holding a position over a longer period of time is in itself a risk management and loss-limiting strategy. However, since as a short term trader you do not have the option of holding a position for a long period of time, you must learn to use momentum and volatility to your advantage.

Despite the above mentioned challenges, short term trading can be very beneficial to a portfolio especially when it is combined with long term trading. Diversification of portfolios enables traders to improve their overall risk/reward balances.

If you are responsible for short term trading strategies in your company, read more insightful articles on our webpages.

The way to trade, using buy side vs sell side strategies, was once a manual process. Most trading took place in automation on the sell side with a fund manager program. An average fund manager program would typically measure the state of balance in a trading portfolio management scenario. With buy side vs sell side, new innovations have evolved in trading technology to balance portfolios and automate trades for comprehensive stock purchasing based evaluations and stock portfolio management. The technology of automated tasks can enrich portfolios with a balanced approach to managing pricing of services and commodities.

The focus of strategy in buy side technology, was once a manually prepared spreadsheet in essence. The automated management systems, in buy side vs sell side portfolio maintenance, are spearheading the actions to increase buy side economics of current trade portfolios. The installation of break through yield management and automation in trade volumes has created ongoing measures that propel order management systems and technology infrastructures forward, into the future of trade volume operations.

In particular, there has been an initiation, of asset and trade management in Hedge Funds, with trade expansion and growth, which have caused a massive growth in wealth for those who can circulate multiple tier assets in the trade volume arena. Those who have excelled in this particular area, called Mass Affluent traders or those with great volumes of liquidity on a global scale, from $100 Thousand to $1 Million, have also witnessed, first hand, a 50% growth to an astounding level of as much as $ 25 Trillion dollars, since last year to their portfolios. With this type of technology applied to the current debt crisis in the United States, proper portfolio management software can essentially wipe out the current level of the national spending debt, with the correct leadership in place to implement this strategy. This ultimately requires dismissal of the current cast of non performers in Washington D. C.

Credit can be given to the use of stock premium purchase side custom trading products that can handle Mass Affluent trading volume. On a micro level, a balance can be automated and struck between the charging of premium prices for many diversified service areas and still continue going forward with a competitive attitude in the densely competitive global trade market. Ceasing the opportunities to implement technology that is automated, at balancing funds, stocks, service and commodity portfolios, can boost any economic strategy that now operates on a mass affluent level.

The buy side is changing rapidly due to new regulations and technologies; find out more on our web sites.

The continuing crises in financial and economic markets is generating a rough time for trading technologists and specialists. As MiFID gradually penetrates through the mainstream marketplace, the latest execution platforms are being released on a seemingly weekly basis. The western industry is seeing liquidity pieces, rather in sluggish paces as compared with the anticipations of others, between solidified main exchanges and a variety of the latest execution interfaces, such as multilateral exchanging industries, dealer funded dark pools, standalone dark pools and sometimes hybrids of the above.

Stated by trading organizations, it isn’t good enough any longer to simply look for the best venue for execution and direct market access. In today’s modern day and age, smart order routing systems have to function as an integral component of exponential trading techniques, working quite fast to compare rates throughout nearly 40 lit and unlit trading venues, guaranteeing that they will suit within any amount of various tactics that may be in play at identical time and then execute.

In simpler and more comprehensible terms, a smart order routing system has become a vital part of the bigger trading marketplace that calls for customization abilities and speed. According to experts and professionals, the trading paradigm is an ever-evolving one and this must be understood by a novice in the field.

Each component of the trading network should be very quick and synchronized. Trading formulas should be rendered quickly. Similarly located databases in the trading venues should also be reliant and extremely fast, not to mention intuitive and flexible. Surmising speed, traders are also in need of transparency. Traders want to be able to know how their merchants and brokers are utilizing the SOR systems where their precepts are sent to, which dark pools are being targeted, and the amount of data regarding their placement is getting divulged in the process.

So how are smart order-routing systems able to keep up with this changing environment? Apparently, it is getting relatively intuitive and sophisticated. SORs were once run in generic approach, perceiving each order in similar means. However, at present, SORs and alternative trading system have to process continuously increasing levels of information. The intuitive and alternative trading system hits the trading market several years in the past hugely to assist traders to stay compliant with NBBO policies and regulations. Nowadays, trading tactics and systems designed for direct market access are now commanding how the systems are operated and plays a much bigger role in its respective industry.

Direct Market Access is set to change the way you trade; learn more on our website.

Quantitative trading and flash trading are two methods of trading employed by the most technologically adept companies to create the most profitable trades. Quantitative trading and flash trading are not something usually done by ordinary investors. They don’t have the brainpower or the resources to do that kind of investing. Instead, they leave it to the big funds and hedge funds to do that kind of trading on their behalf, if they can afford to get in there and play the game.

What Fosters Creativity In Trading?

The ultimate objective of any trading firm is to win, but sometimes not to win big, but to win nonetheless. They want to be the top firm to outpace the market and go further in their prospective trading and beat the competition. They will garner more customers if they can show a better track record than other companies. Success is often measured by profit, and nothing else. They are always looking for the top talent and technological computer edges that can help them get to that goal. There are always a lot of threats coming in though like worse competition, cost controls, new technology, and tighter regulation. This acts like a deadweight dragging down trading and cuts against the bottom line. The old phrase from the old song, “What doesn’t kill you makes you stronger”, really applies to trading in today’s market though. Innovation is produced through opportunity.

When a company uses empirically-based trading techniques and approaches based on rules to help take advantage of possible market insufficiencies that are seen through human behavior, geopolitical chaos, and market movement, then they are going in the right direction. There are tight spreads, thin margins, and low risk goals, and traders are looking for any way to get more of an edge. There is always a quest for new ways of trading. There is a search for deep data over a huge period of time across a ton of different markets like futures and options and currencies across borders. There is a huge data dump going on, and that is where quantitative research comes in. This information plays a huge role in the trade lifecycle. People want to garner as much information as possible to try to be successful. They don’t want to be stuck with the same old tired information that is available to everyone else. That is why they employ novel and inventive trading techniques on the Internet.

Quantitative trading is changing rapidly due to new regulations and technologies; find out more on our web sites.

Dark pool trading is the volume of institutional trading orders not available to the public. Most dark pool trades are done on anonymous block trades separate from the rest of the market and away from the public. As such, dark pool trading has a lesser impact on the market because the release of trade details is not required until after the trade is complete.

When it comes to understanding and utilizing dark pool trade systems, information is important. According to a recent article in ITWorld, there are over 40 such systems currently functioning in the United States.

There are three areas of dark trade systems – independent trade systems, which are established to create a separate trading basis; broker-owned, which created when a broker’s clients are allowed to create and access the pool anonymously, and public exchange, which is an exchange infrastructure is established but anonymity is allowed and orders are not displayed.

The dark pools are part of the national consolidated tape and are marked as over-the-counter. Over-the-counter transactions do not have to be reported to clients unless the crossing network desires to release the information or companies are under contractual obligation to inform clients.

The primary feature of these so-called pools is non-advertised liquidity, which means that the movement of the pool affects the market less since the motion is not transparent. Many investors like these kind of trades because their actions are not evident to others and their identity is not revealed. In addition, the transaction costs are traditionally less.

One of the biggest benefits to the system is that large equity blocks move quietly without affecting the price or the information network at large. This is most commonly utilized by institutional investors seeking to make a large block order without tipping their hand to global investors, which might in turn affect the price of the security. However, the silent nature of the transaction ends once the order is executed, as regulations then require release of the information to the public. Examples of institutional investors include pension funds and mutual fund companies.

These kinds of trades happen on specific trading platforms that automatically track other pools, exchanges and networks for price information. Some software only shows interested firms orders that specifically match their desired sell or buy characteristics in order to reduce overall chatter about the pool.

It is important to note that other investors may still sell or buy their stocks in advance if they catch wind of a particular dark pool trade.

According to Investopedia.com, dark pools constituted almost 10 percent of equity trade volume in the U.S. in 2008. As dark pool trades grow in size, the Securities and Exchange Commission is starting to feel concern that publicly displayed securities quotes are inaccurate due to the large volume of trading that is happening off the exchange. As such, do not be surprised to see dark pool trading changing the game more and more as the trend grows.

Dark pool trading strategies are helping companies improve their bottom line; learn more on our webpage.

The property market in Africa is turning out to be a safe haven for investors in Africa. Rentals have for the past few years been going up quite steadily and as a result the property market has turned out to be one of the safest and profitable areas in the African continent. Property is getting good returns so much that unit trusts that are composed of almost entirely property investments have turned out to be the best performing ones.

Rentals have been steadily going up and the value of buildings have been going up as well. Rentals in the country I live in, Zimbabwe, went up as high as 25% during the first quarter, a development that has seen shares of property companies improving very well and having unit trusts being created to take advantage of the surge in the area. Property unit trusts are providing up to 10% per month and investors are finding the unit trusts a profitable venture. Across Africa, the same trend has been quite the norm and the same boom has been noticed across all Africa and well performing unit trusts have been created in this respect.

Rentals for properties in the Central Business areas have particularly been the best performing ones, the have increased by at least 10% across almost all of the continent. Whether this has been a result of increased investment or just a general increase, this has led to speculation amongst owners and this has quite distorted the market such that rentals are higher than they were this time last year but quite distorted. Office space has particularly become more expensive and mortgages have become a bit more expensive.

Residential properties have become a bit more expensive and the trend is expected to keep on like that such that many financial advisers have been advising their clients to invest in this safe haven. construction companies should really take advantage of this and maybe get to build more properties.

Again as a reference point from the country I stay in, Zimbabwe, the property market is a bit distorted owing to the fact that there is a liquidity crunch, there is really little money changing hands. This has resulted in property prices not being so high but much money is coming from rentals and for the few who have the privilege of owning properties are making quite a good return on their investments.

The trend is quite the same all over the continent and I believe in the short to medium term, the trend is likely to continue and owning property will be, for a long time, a preferred way of investing with assured good returns.

Takudzwa

The $32 billion Harvard University Endowment Fund, which generated a return of 21.4% in the fiscal year 2011, has 23% of its investments held in real-assets, which according the CEO of Harvard Management Company; Jane Mendillo, has been a significant contributor to the fund outperforming its benchmark over the last decade by 270 basis points per year, adding roughly $15 billion of value versus what would have been earned by a more traditional portfolio. The University of Notre Dame also holds a significant proportion of its portfolio in real-assets (17.5%), and delivered a return of 21.5% in 2011. The Yale University Endowment Fund delivered a return of 21.9% in 2011, and holds 29% of its portfolio in real-assets, including real estate and natural resources.

This article seeks to review the investment performance of a range of real-assets, compare that performance to the performance of UK equities, and establish the effect of real-assets on the performance of investment portfolios. In particular, this report focuses on the investment performance and impact of farmland, forestry, gold and fine wine. The following analysis suggests that the low correlation of real-assets with other asset classes means that such investments, whilst potentially illiquid, offer an opportunity to reduce risk and volatility whilst also carrying significant potential to generate superior returns.

The following chart demonstrates the compound annual growth rate associated with a range of asset classes over a range of timeframes assuming a single investment made at the beginning of each measured period and ending at the end of 2011. In the case of the IPD UK Forestry Index and IPD Rural investment Index, data was only available until the end of 2010, however anecdotal evidence suggests that performance throughout 2011 has continued at a similar pace and therefore we feel this still offers a true and fair comparison with the equity indices.

Compound Annual Growth Rate (CAGR)

FTSE 100

Gold
UK Farmland
UK Forestry
US Farmland
US Forestry
Fine Wine

FTSE All Share

Cash

5 year

-2.2%
19.4%
12.0%
17.7%
11.9%
4.7%
10.7%
-2.4%
3.8%

10 year
0.7%
18.7%
10.0%
10.4%
14.7%
7.5%
11.7%
1.3%
4.1%
15 year
6.2%
9.9%
-
-
11.9%
7.2%
-
2.4%
4.4%
20 year
6.2%
7.6%
-
6.3%
11.0%
10.1%
-
4.5%
4.8%

This chart tells us that, broadly speaking, real-assets have outperformed UK equity indices and cash over every period considered. Interestingly, equities is the only asset class examined that generates a financial loss over any given period, indicating a higher degree of volatility than its real-asset counterparts. The timing of this analysis plays some part in forming that conclusion due the impact of the recent financial crisis being included in the 5-year performance data. It is likely then that holding real-asset investment alternatives such as farmland, forestry investments, gold and fine wine throughout a range of timelines will have improved portfolio performance without dramatically altering – and in some cases improving – the overall risk profile.

It should be noted that, in the case of the FTSE 100 and FTSE All Share Indices, these numbers offer only a broad view of the performance of an investment in an index-linked investment vehicle, and do not take into account the upside and downside potential of managing a basket of equities and relying to an extent on picking specific stocks in the hope of ‘beating the market’. Nor does it take into account dividend income which could be re-invested, effectively compounding returns and losses. Investment Managers and Investors might feel they are able to outperform the Index through careful stock-picking and active trading/management, although many studies have shown that, over the long-term, professionally managed equities perform only marginally better than the Index in general, and Investors remain exposed to the likelihood or otherwise that individual investment managers will perform consistently throughout the entire term of an investment.

In this report we have compared the investment performance of a range of asset classes including UK equities, farmland, forestry, fine wine and gold bullion. We have also analysed the effect of portfolio diversification through reducing equity exposure and acquiring real-assets. This report has shown:

Real-assets may contribute substantially to traditional stock portfolios
Real-assets have outperformed UK equities by some considerable margin over every timeframe measured
Exposure to real-assets adds meaningful risk reduction, especially during periods of underperformance or volatility in traditional financial assets

It is clear then that diversification achieved through reducing equity exposure and allocating capital to real-assets has, in the cases reviewed in the this report, improved the overall performance of investment portfolios and reduced risk (considered as volatility) between 2001 and 2011, effectively optimising portfolio performance.

One issue with this basic analysis would be a lack of access to investable projects or assets that give smaller Investors direct exposure to the fundamental characteristics that drive returns in the real asset space. Often, farms and woodlands are too large and expensive for single Investors to purchase, and the specific expertise required to improve, develop and operate those assets is also expensive and hard to come by. It is therefore difficult for Investors to allocate smaller sums of capital to these assets outside of restrictive and often expensive and opaque collective funds. Whilst some funds do offer limited access to certain assets, the structure of such arrangements often hamper asset selection, development and management to such an extent as to deliver much smaller returns than direct investments, as revenue is often absorbed into the cost of the structure and on-going management.

Thios article is an excerpt from a report by David Garner is Partner, Investment Partner at DGC Asset Management, an alternative investments boutique specialising in property transactions in the agriculture and renewable energy sectors. To download the full report, please visit the DGC Asset Management website.

This article addresses some of the risks associated with real-asset investment alternatives in general.

As with any potential transaction, all investments carry risk, and in the case of alternatives those risks are often very specific to the asset class, here we address some of the general risks associated with moveable and immoveable properties considered as alternative investments. This risk-set can be broadly defined and categorised as:

Sector Risk
Location Risk
Asset Specific Risk
Counterparty Risk

Sector Specific Risk

As is the case with traditional financial investments, hard-assets carry risks specific to their sector. For example, in the case of agricultural land, Investors must be aware that a variety of exogenous variables can affect the investment performance of the property. Weather, commodity prices, the cost of farming, and agricultural inputs all factor in the revenue potential and profit margins of a farm. As farmland values are dictated primarily by the income producing potential of the asset, poor on-farm performance can adversely affect capital values. The same can be said for gold; during period of growth in equity markets, gold values may fall as confident investors sell their gold and buy into equities in order to capture returns from raising markets. Subsequently gold values may fall as a result. In the case of timber properties, poor house building figures result in a fall in demand for construction timber, and in these circumstances Investor may not be able to secure the price they require for their timber, and may ultimately leave their trees to continue to grow throughout the downturn, choosing instead to harvest when prices are more buoyant and capturing the extra physical growth that has occurred in the interim.

Location Risk

In many cases, especially in the example of real-estate related investments, Investors may choose to acquire assets in countries other than their own domicile. Asset values in emerging markets are often lower, along with the price of labour, and demand in those markets might also be higher, so acquiring assets that form party of the emerging market supply chain is often a strategy to capture superior returns. Whilst man overseas locations offer security of ownership and a transparent business environment, any overseas investment carries risks specific to the country of operation, and developing economies often carry a much greater risk of political interference or security of ownership issues. This extra risk must be factored into the due diligence process, and the potential returns on offer weighed against this inherent risk to capital.

Asset Specific Risk

When acquiring a tangible asset, it is imperative that the investor has access to the requisite skill-set in order to properly identify any issues with the asset itself. This kind of due diligence is essential in order to establish value of money, and avoid costly investments into otherwise useless assets. In the case real estate based investment alternatives, there may be issue with title, access, planning or even financial issue like outstanding tax bills. In the case of niche property like farmland or forestry, there may be specific issues relating to soil quality or water supply which may ultimately cause the property to be less productive and profitable. In the case of other niche sectors like fine wine or collectibles, very specific experience is required in order to identify genuine investment opportunities, and Investors without access to quality, experienced advice may end up purchasing valueless assets for unscrupulous sellers out to make a quick buck.

Counterparty Risk

When investing in niche products, Investor will usually require the services of a professional to advise on the transaction, but also to operate or manage the assets as is the case with real estate or other assets that require ‘trading’ in order to capitalise on opportunities and minimise risk. In these cases, the investor is exposed to the professional capabilities and honesty of their partners, be they forest managers, fine wine investment managers or collectibles experts. Poor advice at the point of investment and bad or incapable on-going management can ultimately destroy the investment potential of any asset. Proper due diligence is required in order to establish the track record of all partners in their respective fields.

David Garner is Partner at DGC Asset Management, an alternative investments boutique specialising in property transactions in the agriculture and renewable energy sectors.

This article focuses primarily on real-asset investments, and this section is designed to highlight some of portfolio planning characteristics of physical assets when considered as part of a well-diversified and balanced portfolio of investments, as well as some of the inherent risks to be considered when allocating investment capital to specific, niche investment sectors or projects.

Whilst real or hard-assets offer a number of significant benefits including reduced volatility, tangible asset values and the potential for superior investment performance that is not reliant on the performance of traditional financial investments, potential investors must give equal consideration to the potential for relative illiquidity, operational or management risks specific to the asset class, and of course counterparty risk exposure when investing in assets that require on-going expert management in order to maximise returns and minimise downside potential.

Portfolio Planning Advantages

Every asset class exhibits different characteristics when considered from the point of view of an Investor or Financial Planner, and Investors invariable choose to invest in specific assets in order to achieve specific goals such as risk mitigation, portfolio insurance, superior returns and a hedge against inflation or some other potential economic impact on the value and performance of their portfolio.

Here we look at some of the broad portfolio planning characteristics associated with a range of physical assets considered as alternative investments.

Capital Values

By their very nature, physical assets retain a disposal value throughout most economic circumstances, and whilst asset values will fluctuate from time to time, Investors allocate capital to hard-assets in order to underwrite the value of their portfolio and insure against the possibility of the values of listed financial assets falling sharply at any given moment. In fact, certain assets such as gold hold a ’safe-haven’ appeal, often rising in value when stock markets falls as Investors sell equities and buy gold.

Non-Correlated Returns

The fundamentals that support value growth and income associated with real-assets are often far removed from the fundamentals that support traditional investments. Often, alternatives share a direct negative correlation with the performance of equities and bonds, affording investors the opportunity to balance their portfolios and make gains when other portfolio components lose value or underperform. This strategy is sometimes referred to as portfolio insurance.

Diversification

Key to risk-mitigation in financial planning, diversification simply means spreading ones investment risk across abroad selection of holdings, reducing the likelihood that too many eggs are held in one proverbial basket. Diversifying an investment portfolio into a range of holding across different sectors and assets reduces the risk that poor performance in any one asset will have too big an impact on the portfolio as a whole.

Inflation Hedge

A number of alternative investment assets share a strong positive correlation with inflation, rising in value faster than the prevailing rate of inflation. This effectively mitigates the impact of inflation on the real value of investment portfolios. Pension funds and university endowments, along with insurance companies and other institutional investors buy into long-term investment assets such as farmland and forestry for this very reason.

Superior Returns

As detailed in the chart overleaf, many alternative investment assets have outperformed traditional investment assets over the long-term by some considerable margin. Whilst all sectors and strategies carry inherent risk, carefully selected and well-managed real-assets have been shown to generate superior investment returns for the Investor capable of tolerating short term price fluctuations and long-term investment horizons. Operational asset like property also generate income useful when other income assets like cash deposits underperform.

David Garner is Partner at DGC Asset Management, an alternative investments boutique specialising in property transactions in the agriculture and renewable energy sectors.