Women are generally known for their fear of taking risks. When it comes to making personal investments, they are just as diligent as they are with their business finances, carefully balancing risk and reward. Most have a tendency to let others make important decisions for them. This presents a problem when it comes to investing, which is primarily about risk and return. Investing your money is important. It can give you financial security and independence, as well as prepare you for important life events — your children’s education, your retirement as well as any unforeseen financial emergencies. Fortunately, Zimbabwean women are becoming enlightened and seeking to invest their money in lucrative markets. Given our current economic situation, it may be a challenge to identify lucrative markets. While we cannot tell you how to manage your investment portfolio in such a volatile market, we are confident expert advice will help to empower you with the tools to make an informed decision.
Q: What should one consider before making an investment?
It is essential to assess the level of risk you can take before selecting any instruments for investment. There is a direct correlation between the risk associated with an investment and the returns it provides. Generally, the higher the risk, the higher is the potential return. However, some people are risk-loving while others are risk-averse. Your risk preference will determine your investment pattern. Once you know your risk-taking ability, you can choose from a variety of options available for that risk type. For instance, high risk investments include equity investments, while moderate and low risk instruments include fixed income investment options like fixed deposits. Successful investors align their investment instruments with their risk preference. If you have clear long-term goals to achieve with little start-up capital, you might want to take more risk since there is less to lose and more to gain. In our current volatile economy, risk assessment becomes a decisive factor for many investors. Long term investments should be done in forex since the $RTGS is unstable, thus would be an unwise risk. $RTGS can be used for short term investments such as poultry farming which has a short payback period.
Q: What are the different investment opportunities available for women?
There are numerous investment opportunities in the country; one of the major opportunities being agriculture. Zimbabwe is an agriculture-based economy with opportunities for investment in value addition, meat processing, fruit juices, horticulture and floriculture, sugar milling and timber processing. The industry has been doing well despite the 2018/2019 economic decline. It is advisable to venture into export products which have a wide market and can generate foreign currency. Mining is also a sound investment, it is however capital intensive. We have the largest mineral reserves in the world after South Africa. Women with little financial capacity are encouraged to become members of specific women organizations. This makes it easier for them to secure finances and make large investments with increased returns. Nonetheless, one can open a personal savings account. Important to note is the risky local currency therefore it is best to open a foreign currency account in order to protect your investment. All long-term investment should be done in foreign currency to minimize risk. Most women do not interest themselves in finance, which is unfortunately the case in Zimbabwe. Majority of women are often heard complaining about the revised financial policy without having read and fully comprehended the policy and its impact. If women seek to be investors, they have to grow an interest in economics and finance. Investment opportunities are often determined by financial policies. It is how you get to know if a market will be lucrative or a failure.
By Mrs S Marufu
Virtuous Micro Finance