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Jeffrey Notaro

Jeffrey Notaro
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  • Farmland Is The Next Big Thing In REITs [View article]
    The idea of institutionally owned farmland could be a very good thing for the right farm operations. It frees up capital and lessons debt for farmers. In this case though, a REIT that floats the issuers own land and rents it back to himself should never meet any basic due diligence or analysis for investment. The appearance of self-motivated gain is too great, regardless of whether it is true or not.
    Jul 4, 2014. 12:37 AM | 1 Like Like |Link to Comment
  • How To Invest For The Global Food Crisis [View article]
    An undervalued farmland play with none of the political risk associated with Russia and Ukraine is the 2 countries to their south in the European Union, Romania and Bulgaria. Both have the same "black earth" at bargain prices but come with all the support and trade opportunities the rest of modern Europe has to offer (and NATO membership). For large investors, Rabo Farm run by Rabobank is an option, for smaller investors, Black Sea Agriculture Fund. (disclaimer: I know the region because I operate the BSA Fund.)
    Jul 4, 2014. 12:18 AM | Likes Like |Link to Comment
  • Seeking Farmland REIT For My 401(K) [View instapost]
    It seems very likely that emerging market's increasing incomes and urbanization in the coming years will keep the pressure upward on food prices, therefore farmland. Unfortunately, the market in the US has probably priced this in for the moment. There is still great long term value in farmland, I believe reaching out to emerging agriculture regions is where to find good prices still. I focus on the Black Sea region of Eastern Europe. My March 1st blog post compares the the two region's prices versus yield:
    Mar 1, 2013. 11:54 AM | Likes Like |Link to Comment
  • When Considering Alternative Investments, Look At Farmland And Forestry As Well As Gold [View article]
    Overall, trying to target farmland with stocks is not an effective choice. There are basically only 3 choices (the couple of others have serious issues). Cresud and Adecoagro S.A are interesting for small position, but are dragged down by politics in Argentina. Sprott Resource Corp. in Canada is a very diversified company with other businesses besides farming. None have tracked the major bull trend in farmland prices. There are some limited partnerships based in the US that buy farmland directly. They mostly that have high minimums, but are interesting. Since the US is getting a bit pricey for now, I suggest land near the Black Sea in either Bulgaria or Romania were there is still value and plenty of emerging market upside in the ag sector. Both are EU members with democratic, free market and welcome foreign investors.
    Feb 28, 2013. 02:21 AM | Likes Like |Link to Comment
  • Seeking Farmland REIT For My 401(K) [View instapost]
    It still appears as though a much needed farmland REIT is some time away. I would be leery of what first comes to market as well since this will viewed on the inside as a chance for the private investors and the issuer to cash out. The best alternative for now are private limited partnerships. I know they do not offer all the advantages of a large, liquid trading REIT, but they do target the farmland asset class directly. With prices appreciating so quickly, it might be best to find a good one and jump in before it is too late.
    Feb 28, 2013. 02:09 AM | Likes Like |Link to Comment
  • Is A Perfect Storm Coming To The U.S. Grain Market? [View article]
    Grains themselves should never be added to an investment portfolio, there is no way to maintain a long-term position using ETN's or the underlying futures contracts to economically track the long-term trend higher in the likes of wheat, corn and soybeans. Any play on the weather in the upcoming months and its effects on crop prices is clearly speculation. You may be right for those that take on trading positions. For a portfolio investment, farmland is a much less volatile, less risky way to target the major bull market in agriculture products.
    Feb 22, 2013. 12:12 AM | Likes Like |Link to Comment
  • Why Warren Buffett Is Loading Up On This Agricultural Giant [View article]
    ADM should best be viewed as a possibly undervalued stock pick (the type Buffet is know for) and not an agriculture play. Unfortunately, ag-related equities have not tracked the bull market in farmland and have not even kept up with the stock market. Since 2008, SPY has a total return of 11% whereas the agriculture ETF, MOO, is still down about 2%. Neither stocks or agriculture specific stocks come close to the bull market returns for farmland. The NEREIT farmland index is up nearly 62% for the same period. There are no ETF's, REIT's or mutual funds to target farmland but there are alternative asset funds that do. The only caveat at this stage is to be sure the region of focus can still be justified at these higher prices and the strategic approach is sound.
    Feb 22, 2013. 12:02 AM | 1 Like Like |Link to Comment
  • The Allure Of Farmland Investments: Consistent Performance, Low Correlation [View article]
    My research as an investment manager has found there are really few options other than LP's, we offer direct ownership in Black Sea farmland in Bulgaria which has terrific growth prospects and is within the EU.
    Jan 30, 2013. 12:30 AM | Likes Like |Link to Comment
  • Given the drought, scary-low ending grain stocks, and record farm incomes, how much longer will the companies selling stuff to farmers underperform the broader market? The Agribusiness ETF (MOO) has had a decent summer, but has fallen behind the S&P by 2000 basis points over the last year. Top holdings include: Monsanto, Potash, and Deere. [View news story]
    MOO is made up of the companies that provide equipment, goods and services to the agribusiness community. In the long view, increased farm profits and enlarging of the farming industry will mean greater profits for these companies. But, they are also beholden to short term swings in farmer expenditures, such as this year the drought will lower incomes and curtail expansion of farm operations. A much more direct way to invest in the agriculture based bull market is farmland. Land prices have almost continuously gone higher without regard to the stock market or economic conditions - it is truly non-correlated and rising based on strong fundamentals that should persist for many years.
    Sep 13, 2012. 03:02 PM | 1 Like Like |Link to Comment