When we think about investments, equities, stocks, bonds, and other such financial instruments are usually top of mind. However, many other industries can offer a would-be investor the chance to make returns while reaping extra benefits at the same time. Agriculture is a good example. 

You do not necessarily need to own livestock or grow crops to be an agricultural investor just like you don't need to be a trading professional to invest in a mutual fund. All you need is some capital, a basic understanding of the industry, and an awareness of the opportunities that exist for you to exploit. This raises the question, what benefits can one get from investing in agriculture compared to traditional financial services? 

          1. Impact and sustainability

The most beneficial outcome of investing in agriculture is the impact it has, not only on the investor, but within society as a whole. Channeling money into agricultural businesses helps to fund research, expansion, and production of higher quality output. Collectively, this helps to address some of humanity's most pressing challenges, i.e. food insecurity, in ways that are sustainable. On top of this, investors are still able to make a return.

          2. The opportunity to diversify

Diversification is an important tool for individuals who want to grow their wealth over the long term while reducing risk. The typical investor has much of his/her portfolio invested in the traditional financial markets. By investing in agriculture, a non-correlated industry, such investors will get the chance to diversify their portfolios and meet their investment objectives.

          3. Lower volatility

Save for a few rare exceptions, the prices of agricultural output, such as meat and milk are not as volatile as, say, stock market prices or the price of commodities like oil. A lower volatility means lower risk, making agricultural investments ideal for those with a low-risk appetite or those looking to balance their portfolios. 

          4. Stable returns

While various factors affect the performance of individual agricultural commodities, the returns earned in this sector are generally stable. Agriculture produces food and clothing, items essential to people's survival. As such, agricultural output will always be able to keep pace with inflation, increase in value over the long-term, and most essentially, offer returns to investors.

          5. High prospects for growth

Food sustainability is a key priority for governments, particularly in developing countries. Therefore, there are incentives provided to individuals and institutions whose work supports this objective. In Kenya, favorable agro-climatic conditions, government support, and constant demand for quality output mean that there is a lot of potential for growth in the industry and those who invest in it.

In conclusion, investing in agriculture is generally a win-win venture for everyone involved. While it has its challenges, it offers investors diversification, stable returns, lower risk, high prospects for growth, and most crucially, the chance to create sustainable, positive change in our communities. It should definitely be a part of any conscientious investor's portfolio.