Trade Finance | Smart Money Match
Blog

Trade Finance

 


With interest rates rising globally, traditional investment options have become increasingly uncertain. It is now more critical than ever for investors to diversify their portfolios and safe-harbour their investments. Credit-insured factoring and trade finance is an often-overlooked asset class that provides an attractive yield, low risk, and stability in the face of rapidly changing market conditions.

Trade Finance is an excellent investment to combat rising interest rates for five reasons:

1. High yields, low risk: With rising interest rates and volatile markets, investors return to fixed-income and increasingly private debt assets for stability. A short-term tenor, credit-insured or secured by the underlying goods being traded, factoring and trade finance offers an attractive and safe alternative to traditional markets. Unlike other fixed-income assets, the margins or yields in trade finance transactions are agreed upon at the transaction time and hence do not fluctuate with market conditions. This makes trade finance returns a stable and predictable investment option.

2. Low correlation with other asset classes: A critical advantage of trade finance is its low correlation with other asset classes like stocks or bonds, providing diversification to any investment portfolio. Adding trade finance to a portfolio mitigates risk exposure while stabilising, if not enhancing, returns.

3. Participation in essential global trade growth: Factoring and trade finance are critical for international trade. By investing in trade finance, investors participate in the development of the global economy and benefit from the increasing demand for trade financing.

4. Opportunity for international investment: Trade finance is not limited to a single country or region, making it an ideal investment option for international investors. Whether focused on Europe, Asia, or the Americas, credit-insured trade finance and factoring provide a unique opportunity to selectively diversify your portfolio and gain exposure to a wide range of global trade transactions.

5. Trade finance performance during economic downturns: Trade finance has a proven track record of performing well during economic downturns. Trade finance remained resilient during the 2008 financial crisis while other asset classes suffered. Trade finance was one of the few asset classes that continued to provide stable returns during the crisis. Similarly, during the Covid-19 pandemic, trade finance emerged as a sound investment option, maintaining low default rates and attractive yields.


In short:

Whether you are a domestic or international investor, trade finance provides the rare opportunity to invest in the global economy while mitigating risk and achieving attractive yields – all backed by credit insurance.


Further reading
For further reading, the book 'TRADE WORKS' can be recommended. Unlike traditional finance books, 'Trade Works' is an accessible, witty, and insightful compendium on trade finance. Written by Wall Street Journal best-selling author Andreas Schweitzer, the book provides experienced investors and newcomers a unique opportunity to explore the untapped potential of the highly lucrative trade financing market.

 

Find out more
 

authored by Andreas Schweitzer 

Chat with the book
Experience a new way to explore Andreas Schweitzer’s book. Access the insights and research within ‘Trade works: The trade finance investor’ immediately, with an AI powered book bot. Simply ask a question and the book bot will provide the answer. Give it a try.

Try BookBot
 
Artis Trade Invest
Artis Trade Invest offers privileged access to credit-insured SME trade finance assets. This underrated, secure asset class generates stable returns with low volatility. The fund is advised by Andreas Schweitzer, MD of Arjan Capital Ltd. Schweitzer's personal track record produced yields in excess of 10% p.a..

Investment strategy: Insured Trade Finance/Factoring Investment
Contact: Andreas Schweitzer

Email: as@artistradeinvest.com
Phone: +44 207 323 64 26

Find out more
 
Recommended events

For registration and discount information visit the page links

 

3rd Edition Connected Africa

Jul 25, 2023, Johannesburg

DIGITAL TRANSFORMATION IN BANKING

Aug 11, 2023, Singapore

IndoSec 2023

Aug 29 - 30, 2023, Jakarta

UK-UGANDA | EAST-AFRICA TRADE SUMMIT

Sep 8, 2023, London

MoneyLIVE Asia

Sep 12 - 13, 2023, Singapore

3rd Digital Identity & Authentication Summit

Sep 12 - 13, 2023, Dubai

DIGITAL TRANSFORMATION IN BANKING SUMMIT

Sep 14, 2023, Amsterdam

Reuters Events: Connected Claims USA 2023

Sep 16, 2023, Austin

Catalyst Cap Intro: Alpha Active Investing

Sep 18, 2023, New York

MiningNews Select

Sep 18 - 19, Perth

Going Global Live

Sep 20 - 21, 2023, Los Angeles

Catalyst Cap Intro: Alpha Active Investing

Sep 18, 2023, New York

MiningNews Select

Sep 18 - 19, Perth

ESG Investment 2023

Oct 2, New York

9th Pharma Packaging And Labeling Innovation Forum

Oct 5 - 6, Berlin

Reuters Events: Hydrogen North America 2023

Oct 11 - 12, 2023, Houston

2nd World ESG Summit

Oct 26 - 27, 2023, London

2nd World ESG Summit

Oct 26 - 27, 2023, Berlin

View more events
 
 

You are subscribed to [EMAIL] for English newsletters.
If you no longer wish to receive this email, you can unsubscribe or adjust your email settings here.

© 2023 SmartMoneyMatch
SmartMoneyMatch is a brand of 4Finance Ltd.
Hammerstrasse 78, 8032 Zürich, Switzerland
Registered in Switzerland as Ltd, Company Number CHE-113.803.925


www.SmartMoneyMatch.com

Economic Analysis   Newsletters   Investing