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Chocolate Covered Investing

September 25, 2013

I am always a fan of looking for investing opportunities and/or stories that might not be receiving the coverage they deserve in traditional in financial media. Since the financial recession, and during the subsequent recovery, the interest in investing via alternative assets has been on a sharp rise. In the low interest rate environment that has persisted since the financial crisis, aided by the Q.E. programs enacted by the Federal Reserve, investors have been looking for securities that could provide them with the yield they require. In addition to the possible re-flating of the real estate bubble, the increased interest in MLPs, and the overall inflows into dividend paying stocks and junk bonds, interest in alternative assets have increased.

One of these alternative asset classes that might be worth considering investing in is chocolate. Delicious and well-known, it could always be quite profitable as well. Driven by demand in the both developed markets, as well as increasing demand from emerging markets who are developing a collective “sweet tooth,” chocolate (cocoa being the underlying commodity) might be something to consider investing. Cocoa options and futures are traded on commodities and futures exchanges, so if you are seeking direct exposure to the commodity, that is certainly one way to obtain it.

What if you don’t want to start dabbling in options and futures? No problem. There are ETF’s that bundle various cocoa producers and refiners (see below with links with more information).

Some of the largest chocolate and confectionery firms in the world are publicly-traded firms. Hershey, Kraft, Nestle, and Lindt are all very well-known firms, with large chocolate operations, and all are publicly traded. The “blue-chip” status that some of these firms have does add an additional layer of transparency and financial fortitude that might help reassure potential investors that are skeptical about investing in “candy”

As always there are links with more information.

Happy Reading! http://commodityhq.com/2012/the-five-minute-guide-to-cocoa-etfs/
http://www.gobankingrates.com/investments/happy-chocolate-day-skip-box-invest-chocolate-instead/

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