Forest fund

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A forest fund is an investment fund that invests in the forest asset class . It is often an ecological investment or an ethical investment .

description

In a forest fund, the capital is invested in forests. Most of the time this is done in North, Central or South America, because in the past significantly higher returns were achieved there on average. Some providers invest in plantations in southeast Europe. Most investments are made in plantation management , i.e. in the monoculture of a tree species ( eucalyptus , pine , teak, etc.). Forest funds that invest in the reforestation of tropical mixed forests or the sustainable management of almost original rainforests are ecologically more sensible, but significantly less common.

After the trees have grown, most of them are felled and the wood is sold. The difference between the invested capital and the proceeds from the sale of wood is the return on this type of investment. In addition, the investors may receive proceeds from the sale of CO 2 emission certificates , seeds and seedlings.

The positive ecological side effects: as long as the trees are growing, they withdraw CO 2 from the atmosphere and store it permanently in wood. Compliance with the socio-ecological criteria can be monitored, for example, by the Forest Stewardship Council (FSC). If fallow and pasture areas are afforested with mixed forests, this also has a positive influence on species diversity. The highest possible proportion of natural forest relics or natural forest cells, that is, unmanaged forest areas, also has a decisive influence on biodiversity .

to form

Forest funds can be offered in different forms. Closed funds are mainly sold . However, there are also mutual funds , bonds or company shares on the market.

Properties of the asset class

The investor bears the entrepreneurial risk of the investment. In extreme cases, forest areas can be completely destroyed by natural disasters , in which case you would have a total loss if this is not insured or the investor has also acquired part of the land. The future wood prices and thus the return are uncertain, the market is often difficult to see through for small investors. The capital is not very liquid : it is usually tied up for a long period of up to 30 years, and shares are difficult to sell in advance. If the forests are located abroad, there may be a legal risk as well as a country risk . The Stiftung Warentest therefore speaks of a "highly speculative investment" when it comes to forest investments.

In a test in 2018, Stiftung Warentest came to the conclusion that all tested investment products were defective. The main points of criticism were a lack of transparency and the specified but incomprehensible expected wood prices. Only if you are ready to donate the same amount should you subscribe to forest investments, so the recommendation.

Conversely, there are business opportunities. As a tangible asset , forest funds tend to be protected against inflation . The investor benefits from historically rising wood and land prices.

To what extent the development of forest prices correlates with the performance of other asset classes is controversial.

Designations

Investments in forest are offered under a variety of brand names such as "WaldInvest", "BaumInvest", "WaldSparBuch" or "BaumSparVvertrag". Payments to a TreeSavingsPlan are tax basically not relevant and therefore not as a special edition or as income-related expenses / business expenses deductible.

Individual evidence

  1. ↑ a b The dream of the tree . In: Stiftung Warentest (Ed.): Financial test . October 2009.
  2. ↑ Heinz-Roger Dohms: In the forest of leaves . In: Süddeutsche Zeitung . ( sueddeutsche.de ).
  3. ↑ What does the FSC certificate mean?
  4. ↑ Jose Carlos Garcia Salazar, Elliese Jayne Judge: Biodiversity Progress Report 2015/2016. Forest Stewardships Councils - FSC, accessed on January 31, 2018 (Biodiversity study by experts from the "FSC" - Forest Stewardship Councils on ForestFinance areas in Panama 2016.).
  5. ^ Heinz-Roger Dohms: Forest investments: Business with Woodstock . In: Zeit-Online . March 14, 2014 ( zeit.de ).
  6. ↑ Forest investments: All offers in the test fail . In: Stiftung Warentest (Ed.): Test . January 2018.