Overcoming the Challenging Realities of Investing in Uncertain Times
A myriad of challenges have continued to plague countries around the world due to the current post-pandemic realities that are straining most of the world’s economies. Add to this the fear of uncertainty as decision-makers seek ways to effect change in a difficult operating environment. To alleviate these challenges, economies have sought creative ways to diversify their income to avoid over-reliance on a single source of income. Major oil producers such as Saudi Arabia, UAE and others are taking strategic steps to diversify their economies away from oil as they seek alternative opportunities in trade, tourism and energy own.
In Nigeria, we are also looking for alternatives and we are trying policies to help us overcome the current challenges. The shortfall, particularly from crude oil sales, has resulted in increased government borrowing to fill the revenue gap. Over the past three years, Nigeria’s income has remained stable at an average of 3.9 trillion naira, with the country’s spending galloping faster than its income, rising from 4000 billion naira in 2010 to 10,000 billion naira. naira in 2020, with a budget deficit of 6 trillion naira ($ 14 billion) annually.
In order to fill the country’s revenue deficit, the government has resorted to borrowing from local and international institutions. However, this only served to increase the country’s public debt, even though the borrowed funds were aimed at filling Nigeria’s infrastructure deficit.
This economic measure is a major source of concern for analysts who remain worried as 83 percent of the country’s earned income is used for debt service. Foreign direct investment, which remains Nigeria’s constant source of foreign exchange, halved from $ 2.2 billion in 2014 to $ 1 billion in 2020, while smaller countries like Ghana experienced an increase in foreign direct investment (FDI) during the same period. This has intensified the call for diversifying the nation’s interests from petroleum to other sources such as agriculture, commerce and technology.
For investors, especially in Nigeria, diversification helps manage risk and reduce the volatility of asset price movements and the risks associated with individual investments. Diversification offers an opportunity to spread risk by investing in different investment categories, preserving capital and generating returns. Plus, savvy investors are a must at a time like this. Men and women who are able to explore the field, properly assess opportunities and expertly position investor funds where they can generate returns while preserving their capital.
Over the years, Stanbic IBTC Asset Management has continued to spearhead the economic growth of its clients, providing investment solutions and products aimed at growing their unique portfolios. With over 16 investment products, expertly managed private portfolios and other diversified investment options, the company helps thousands of Nigerians develop and preserve their wealth.
One such fund is the Stanbic IBTC Enhanced Short Term Fixed Income Fund, which aims to generate stable income and preserve capital with an annual return of 6.54 percent. The Fund provides liquidity to investors as 100 percent of the portfolio’s assets are invested in high quality short-term securities such as treasury bills, commercial papers, term deposits and bonds.
With the increasing decline in the value of the naira, the Stanbic IBTC Dollar Fund offers investors the unique opportunity to invest in dollar denominated securities. The Fund offers currency diversification, income generation and stable growth in US dollars. It seeks to achieve this goal by investing at least 75 percent of the investment portfolio in high quality Eurobonds, a maximum of 25 percent in short-term dollar deposits and a minimum of 10 percent in bonds. US stocks approved by the Securities and Exchange Commission. (SEC) while delivering a five to six percent return on investment.
As Nigeria continues to seek funds to close its infrastructure gap, the recently launched Stanbic IBTC Infrastructure Fund directly aims to support this effort by matching private and high net worth investors with project developers seeking capital. long term so that infrastructure projects can be financed. while investors earn steadily over the ten to twelve year investment period. These are just a few of the solutions that Stanbic IBTC offers Nigerian investors looking for safe investment options that would help them maintain profits and protect against capital depreciation during these difficult times.
As investors navigate the available investment opportunities, it is important to exercise caution in avoiding unauthorized or unregulated investment managers whose offers seem too good to be true and who are not transparent. in the way they communicate and conduct their business.
Investors are urged to be vigilant and monitor their investments, protect themselves online, conduct personal research, ask questions, and seek professional assistance when finding profitable investment opportunities.
For the security, professionalism and expertise that deliver consistent returns, Stanbic IBTC Asset Management continues to be a preferred partner for investors who create lasting wealth. The organization remains committed to helping Nigerian private and private investors through difficult times like this with the hope that better days lie ahead and that when they do, the company, its customers and the nation in. as a whole would be sufficiently prepared to maximize them. .
For anyone looking for tailor-made investment support or advice, experienced investment managers can be contacted by email at [email protected].