About Investing In Africa
Welcome to Investing in Africa, your guide to profitable opportunities in African stock markets.
I suspect the majority of investors would find the words “profitable” and “African” oxymoronic. And who can blame them? The news media is saturated with images of famine, war, and disease on the continent.
But there is another side of Africa that gets a lot less press. It is a place full of hopeful and enterprising people who are confident of a better future. This is the Africa that I believe is home to some of the most attractive potential investments in the world today.
Let’s look at the track record.
Question: How many African stock market indices outperformed the S&P 500 over the past three years?
Answer: Nearly all of them - and that’s in US dollar terms.
Moreover, the African indices didn’t just beat the S&P - they ran circles around it. The Mauritius All Share Index was up 75%, the Nigeria All Share Index doubled, and the Malawi Domestic Index posted a 500% return in that time period.
Of course, the past is no guarantee of similar performance over the next three years, and high returns are most often accompanied by high risk. My contention, however, is that the risks of investing in Africa are actually much lower than they are perceived to be.
Investing in Africa will help you track down well-managed and undervalued African companies that are directly contributing to their continent’s development. An investment in these firms gives you the benefit of global diversification, helping to calm the rough waters of a US-focused portfolio.
Each month, I’ll highlight what I believe is an excellent African investment opportunity. These companies will be locally-run, operated with integrity, and offer substantial returns with moderate risk. I’ll track each selection in US dollar terms and update you if the risks begin to outweigh the potential rewards.
I’ll also introduce you to people and resources that can help make your African stock portfolio a reality. The continent hosts a growing number of stockbrokers and information sources. I’ll investigate and review them, and outline the steps toward your first African stock purchase.
Thank you for your interest in Investing in Africa. We have lots of exciting opportunities to explore, so I hope you’ll join us!
About Ryan
Ryan is a writer and researcher with 10 years experience working on African issues. He lived in the southern African nation of Lesotho for several years. During that time (and in the years since) he witnessed both the positive and destructive impacts that business practices can have on the continent’s poor. Through the Investing in Africa newsletter, he strives to highlight African companies that contribute to human development while delivering market-beating returns to investors.