Agribusiness offers an investment option for investors with a focus on Australian agricultural commodities such as forestry and horticulture. Agribusiness can diversify an investment portfolio as it has low correlation with interest rates, share markets, bonds or property markets.
Agribusiness is appropriate for investors who are seeking to build long-term wealth in an asset class that is not correlated (in terms of movements in market prices and returns) with the other major asset classes.
Before investing in any agribusiness managed investment scheme, it is important to consider:
- Is there a valid product ruling for the managed investment scheme?
- Does the investment scheme have a current product disclosure statement or a current prospectus lodged with ASIC?
- Is the investment scheme promoter licensed by ASIC?
- Commissions should be outlined in the product disclosure statement or prospectus – be wary of investment schemes where high levels of commission are paid to managers (more than 10-20%).
- Investigate the financial arrangements and structure of the investment scheme.
- Is your return guaranteed?
- Always seek independent financial and/or legal advice on particular investment schemes.
You should be cautious of investment schemes that promise substantial tax benefits.