Forest in your wallets

Forest scenery with beautiful sun rays

We are entering a period where equity market returns are more uncertain than ever with global growth that seems difficult to recover, the end of central bank accommodative monetary measures and the return of political risk. </p

All these factors rightly make investors suspicious of equities and it is finally good news. The investment world is very diverse and it would be a pity to focus on only one asset class, especially if there is another one with regular positive returns, an attractive tax advantage and a global benefit.

Evidently, with such arguments, any investor would tend to mistrust and doubt the existence of such an opportunity, yet everyone knows it since it is the forest.

The forest is a historically low-risk asset whose value in France increased by 76% between 2000 and 2015, from 2290€/ha to 4040€/ha. The CAC 40 cannot say the same since in the same period of time, it showed a loss of nearly 30% (since its peak in August 2000) but above all a much higher volatility while the forest showed an almost constant increase in its value year after year.

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Above and beyond a steady growth in its value, forests are of great interest in terms of diversification because it is clear that the price of French forests is totally unrelated to that of the equity market and that the successive crises have had neither a positive nor a negative impact on the value of wooded land.

exempt from 100% of the ISF and has a 75% tax allowance in the event of a transfer.

There is another argument in favour of the forest that is more sentimental than financial but against which corporate actions cannot compete and which comes from the fact that the forest is above all a tangible asset. Because what makes this type of investment attractive is also the idea for the investor to own his own forest plot and especially to be able to walk around whenever he wants, which is still much more difficult to do with companies in which we own shares.

However, it is true that investing in the forest requires a certain patience since nature takes its time and that if you have chosen to invest indirectly through a specialized company, your investment can be blocked for a minimum period of five years.

So if you are a patient investor and want to diversify your equity portfolio with tangible assets, the forest is the perfect alternative investment to continue to grow your wealth while keeping your mind at ease, away from the constant fluctuations in the stock markets.

Benoît Gueguen



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