• About
  • Forestry Investment
  • World Forestry Update
  • Archives
  • Categories
  • Making a Fortune from Brazil’s Good Fortune

    2010 - 09.01

    According to the International Monetary Fund, Brazil has recovered from the global financial crisis faster and sooner than other economies. Brazil is at the enviable position for sustainable growth and again according to the IMF Brazil’s economy is estimated to grow at a healthy 7.1% this year.

    This level of growth represents a sustainable pace that is unlikely to generate the rapid inflation that has plagued this part of the world during the past economic expansions. In terms of inflation rate the IMF has predicted a Brazilian inflation rate of 5.8% during the remainder of this year. This may appear a tad high, at least compared to US standards but it is actually quite modest if compared to past inflation trends in Latin America.

    What makes Brazil so enviable is that Brazil’s growth is attributable to not only strong natural resources development and export growth but also to domestic consumer demand. This domestic consumer demand is increasing as Brazil’s population continues to improve their economic status and living conditions.

    By expanding credit the Brazilian financial sector is appropriately supporting growth and the economy as a whole is profiting from heavy capital inflows coming from abroad.

    So the question is, how does an individual investor make a small fortune from the opportunities presented from Brazil’s good fortunes?

    The answer to that is very cautiously. For all the good news coming out of Brazil it is still an emerging market. However, there are a number of different approaches to access opportunities in Brazil in both an easy and cost effective way.

    Of those various options I have listed below three of what I consider to be the safest and most secure ways of investing in Brazil.

    1. Bonds are a good place to start and some brazilian bonds can be bought in dollars by individual investors. In addition many emerging markets bond mutual funds have considerable positions in Brazil as well.
    2. Investing in forestry plantations is not only very profitable with average annual returns of 10%-14% but also very environmentally friendly. Companies worth looking at for more information are The Phaunos Timber Fund, Greenwood Management and Cambium.
    3. ETF’s like I-Shares EWZ, tracks the MSCI Brazil index and can provide investors with broad access to the Brazilian economy.

    The Timber Investment Blog is sponsored by Greenwood Management. For more information on investing in Timber please click here.

    One Response to “Making a Fortune from Brazil’s Good Fortune”

    1. This is great information.

    Your Reply