Wealth Management – Global Infrastructure

Global infrastructure assets are long term developments or projects serving communities around the world. They are assets that economies require to function and prosper such as airports, gas, electricity, water and roads. Which Wealth Management strategies are you considering to benefit from these assets?

Good infrastructure improves the competitiveness of economies and generates high productivity. In addition, the ongoing maintenance and development of these assets requires large spending programs, which in turn creates local jobs.

Infrastructure can make for an attractive part of your wealth management strategy due to:

* Long term contracts usually guarantees revenues for many infrastructure companies,

* Demand for the services are usually stable and not affected by economic cycles, and

* High barriers to entry exist for competitors due to the complexity of the projects being completed

Global Growth Projections

Global population levels are forecast to grow from around 7.5 billion today to 8.5 billion by 2030, 9.7 billion by 2050 and 11.2 billion in 2100[1]. For a government to maintain and increase the standard of living for its population, it will need to continue to invest in projects to support the rising populations.

Worldwide infrastructure is expected to total more than $9 trillion (that’s $9,000,000,000,000) by 2025[2] to provide for this growth. Emerging markets are expected to make up around half of this growth as the rural population moves to urban centers. This will result in spending growth in sectors such as water, power, telecommunications and transport.

How can you benefit from all this growth?

Potential benefits to your portfolio include:

* Diversification benefits from having assets that aren’t as sensitive to economic conditions due to the stable demand for their services

* Revenues should grow over time for user-pays infrastructure assets such as toll roads, airports and railways

* Usage charges for the services are usually tied to the rate of inflation

* Infrastructure companies can generally build cashflows for their investors that are less volatile than the broader listed share market

Focus Company – Italgas

One of the companies focused on by infrastructure fund managers is Italgas (www.italgas.it/en/). They are the market leader in Italy in delivering gas to households and businesses throughout the country. Italy is the third largest gas market in Europe and the company is positioning itself to take advantage of further growth.

Italgas has a very clear vision for preserving their profitability and looking to continue building on their solid balance sheet and strong cash flows. More information on their strategic plan can be found at (http://www.italgas.it/up/italgas/ITALGAS-Strategy_2017_2023.pdf)

How Endorphin Wealth Management can help

Non aligned

Here at Endorphin, we have no alignment to the big banks and financial institutions, so the advice we provide is always in our client’s best interests. We have the advantage of being able to access a range of products from different providers that can be tailored to our client’s needs.

We also utilise subscriptions to three of the top research providers in Australia to cross reference our research and recommendations.

Comprehensive analytics and research

We invest a great deal of time and effort researching the best wealth management strategies for our clients and have developed a number of systems to manage and track the marketplace. We’ve been able to identify some excellent options for our clients to make the most of our growing global population and the infrastructure to support it.

The investment landscape always evolves and it is more important than ever to consider your investments and superannuation funds carefully. We pride ourselves on being experts in researching opportunities, investments and strategies that fit in with your retirement goals and to create a happy and carefree retirement. We want all of our clients to get on with enjoying their life rather than worrying about money.

For an obligation free conversation about your financial future, please contact us on 03 9603 0072 or at advice@endorphinwealth.com.au

Phillip Richards and Robert Rich
Endorphin Wealth Management

Phillip Richards is a qualified Financial Advisor with over ten years’ experience. Contact Phillip today to discuss how you can build your own wealth and plan to reach your retirement goals.

Robert Rich is a qualified Associate Financial Advisor with over nine years of personal investment experience. Contact Robert today to discuss how you can build your own wealth and plan to reach your retirement goals.

This information is general in nature and does not take your personal situation into account.

[1] UN Department of Economic and Social Affairs

[2] PWC – Capital project and infrastructure spending – Outlook to 2025 (https://www.pwc.com/gx/en/capital-projects-infrastructure/publications/cpi-outlook/assets/cpi-outlook-to-2025.pdf)