Akwaaba – To this new column that seeks to share insights into the financial market in Ghana – This is a new initiative by GAJ in partnership with Mr. Kofi Afreh, a seasoned investment Banker with GN Financial. As Ghana’s economy continues to grow, the investment climate for individuals, as well as corporations continues to rise. Many Ghanaians in the diaspora are eager to invest in Ghana, however, they lack the understanding or even trust of the local market. This partnership is an effort to help educate the public about the investment climate in Ghana and the opportunities and risks to consider – What are the different types of investments, who can invest, when to invest, among others . This column is dedicated to our readers who seek to invest back home in Ghana in the formal sector.
Introduction to Investing in Ghana
An Investment is anything you commit resources to with the aim of future economic benefit. That is to say, thinking of the future today. The future could be a day, a week, a month, a year or two or more. Determining what the future is for you depends on why you are investing in the first place. This will then lead to whether you are investing for the short term, medium term or long term.
Investing should not be by accident. It must be planned. It must be well thought through to ensure you achieve the aim for which you are investing – is it for a project or property back home, school fees of your kids back home, or is it to take care of some regular payments or to have funds you can rely on when you come home for vacation. Consider your personal financial circumstances – can you make this investment without any adverse effect on your finances; is it going to be a one-off bulk investment or periodical. If it is going to be periodic, what will be the frequency – weekly, monthly, quarterly or yearly?
You must monitor your investments on regular basis to ensure you are achieving your set targets.
Warren Buffet puts this nicely “risk comes from not knowing what you are doing”.
Simply put, plan your investments and make sure you stay focused and disciplined to ensure you achieve your investment goals.
After all is said and done, talk to an investment professional to guide you through your decisions.
Look out for this column in subsequent editions of GAJ Report. We will educate you and help you make the right decisions when it comes to investing in general but particularly back home in Ghana.
This is for your general knowledge only. Please consult an investment banker if you need a more personalized advise.
Until then, I remain KA.
PROFILE – BENJAMIN KOFI AFREH
Benjamin is the General Manager (GM), Marketing & Investor Relations in Gold Coast Holding. Prior to this appointment, Benjamin was the General Manager for Gold Coast Brokerage – a position he held for 6 years, being the first GM of the company.
He successfully led the fund-raising of HORDS and DIGICUT and their subsequent listings on the Ghana Alternative Market during his tenure as the GM of Gold Coast Brokerage. He also led the turnaround of Gold Coast Brokerage into a profitable company in his last year as General Manager of the Company.
Benjamin has worked with Gold Coast for over a decade in various capacities rising through the ranks of officer, Acting Branch Manager, Head of Department, Head of Operations and then General Manager of Gold Coast Brokerage.
Benjamin holds an MBA in Finance from GIMPA, Diploma in Financial Management from ACCA and BSc. Agriculture (Economics) from KNUST.
He is licensed by the Securities & Exchange Commission as a Broker-Dealer and by the National Pensions Regulatory Authority as an Individual Trustee.
Benjamin is an active sports person with interest in football and tennis and loves travelling.
You may contact him on whatsapp or call on +233 244 216614 or on email firstname.lastname@example.org
Investing In Ghana – Series II
Previously we had discussed the objectives for investing. Why do you want to invest in the first place? Is it for a comfortable retirement or to pay those college fees for your ward or to develop that land you bought sometime back? All of these and many other reasons should form the basis of your investment and decisions there on. Don’t invest just for the sake of it.
I do hope now you understand why you must work on the objectives of your investments.
Now that we have put together the objectives of our investments, we need to determine whether these objectives are long term, medium term or short term objectives.
Any objective that must be achieved within 1 year is typically classified as a short term, while a long term objective is one that is typically 10 years and above.
Determining the time horizon is important because it helps in deciding how much funds you need to set aside (whether in bulk or regular contributions), the type of investment portfolio to build, and the risk to take among others.
Generally, when your objectives are short term, your risk tolerance is low, while with a long term objective, the risk tolerance is normally high. This is because the long term objective allow for space to manage risk better than a short term objective.
Short term objectives – as indicated earlier, short term objectives hardly go beyond a year. It is typically objectives that must be achieved within a year. This may include planning towards your vacation; paying up your yearly rent; paying up the fees of your wards in school etc.
Medium term objectives – these are objectives that are normally targeted for between 5 to 10 years. These may include setting aside funds for college education of your kids, acquiring a property, starting up an entrepreneurial project or starting a new business etc.
Long term objective – these are objectives that are designed for projects or programs 10 years and above. These may include retirement planning to ensure a comfortable pension, towards acquiring or putting up your dream home, or settling back into your country after your long stay abroad. Because these objectives are long term, you have time to better manage the risk that comes along with it.
Remember that this is not a one-size fits all discussion. An individual or couple’s medium term may be another person’s short term etc.
As we continue these discussions in subsequent editions you would come to appreciate further why the time horizon is important to achieving your objectives taking your risk profile into consideration.
I will come your way again. Until then, enjoy a great week. I remain KA.
You may contact me on whatsapp or call on +233 244 216614 or on email email@example.com