Five investment opportunities for Africans to consider in 2022: 2022 is still a relatively new year, and many people are busily plotting their financial strategies. Unfortunately, there are few sustainable investment opportunities, owing to the pandemic’s unfavorable impacts, which continue to exert pressure on the majority of African countries. Despite this, COVID-19 has offered investors some undervalued assets to explore, according to Olumide Adesina, an analyst at Quantum Economics.
“With COVID-19 impeding the global economy, particularly in 2020 and 2021, feasible investment opportunities are quite constrained. However, investors should investigate a number of discounted assets in Africa. For one thing, I believe banks, particularly tier-1 Nigerian banks, stand out. Despite relative weakness in interest rate profits over the last two years, the African banking industry retains a dominant position in 2022 as a result of its track record of good success in rising rate situations… By investing steadily in these banks over time, making prudent investment selections, and reinvesting bank returns, you can accumulate a sizable store of money “Olumide stated during a phone interview with Business Insider Africa.
He continued by highlighting a number of other investment opportunities to explore in 2022. As a result, we’ve whittled them down to five, as illustrated below.
Five investment opportunities for Africans to consider in 2022
1. Invest in African technology startups
It’s self-evident that African technology firms are thriving at the moment. And there is no better moment than now to position your investments to expand with them. Therefore, if you’re still considering where to invest, consider African technology firms, particularly those in Lagos, Cape Town, and Nairobi. They are doing an incredible job. Foreign investors are well aware of this, which is why they invested nearly $5 billion last year in African technology.
“Another crucial area for investment in technology. We’ve seen a plethora of value assets emerge in that space. You cannot overlook the reality that companies such as Chipper Cash, Flutterwave, and Paystack have expanded their footprints inside the global technology ecosystem. As a result, international investors are extremely interested in investing in that sector. As a result, those with exposure to secondary markets can take advantage of the opportunity “As Olumide stated.
2. Invest in Bonds and Treasury Bills
Due to their low-risk character, they have historically been the preferred investment option for the majority of investors in Africa. Therefore, invest in series 1 savings bonds, treasury bills, and corporate bonds.
“As a result of the tapering and global dovish shift, Eurobonds issued by Sub-Saharan Africa should profit from weakened market attitudes and generate good investment opportunities. Nigerian, Ghanaian, and Angolan Eurobond rates are predicted to reach the double digits in 2022. And any investment that generates double-digit dollar returns is unquestionably a bargain “As Olumide stated.
3. Invest in the stock markets
Olumide Adesina previously recommended investing in African bank equities. That is unquestionably something you should consider. On the continent, there are almost 30 stock exchanges. And they all feature some of the market’s best-performing stocks. Therefore, invest in African companies. Purchase bank and telecommunications stock, as well as cement company stock.
“Additionally, you cannot disregard the cement behemoths that are heavily invested in the infrastructure sector. As you can see, several countries, including Africa’s largest economy, Nigeria, are concentrating their efforts on infrastructure development/upgrading. This will undoubtedly assist cement manufacturers and their stock prices “Olumide has been added.
4. Invest in crypto-assets and NFTs
For the majority of people in Africa and abroad, cryptocurrency has become a significant financial alternative. However, keep in mind that while these assets might earn you a lot of money, they are also extremely risky.
As a result, you should exercise extreme caution when dealing with them. Olumide recommended that “Cryptocurrencies (including NFTs) are known for their exponential rise. However, due to their inherent risk and upcoming legislation, you should minimize your exposure to them.”
5. Invest in Agriculture
Another straightforward investment is in agriculture. Human beings will always require nourishment. As a result, any business that specializes in food production is certain to profit. Therefore, consider investing in agriculture directly or indirectly through specialized companies; especially agritech startups.
Now, as you proceed, it’s critical to emphasize that you should avoid investing your whole portfolio in high-risk assets such as cryptocurrency and Forex. It can be alluring to do so due to the possibility of enormous gains. Regrettably, the dangers are real.
So far we have been able to discuss five investment opportunities for Africans to consider in 2022. Rather than that, diversify your portfolios so that you have few equities, few bonds, a little bit of crypto/Forex, and a little bit of high-yield savings, among other things. In this manner, if something unpleasant happens to one asset type, you have a backup plan.