Investors Must Know Their Risk Profile Before Committing Funds – Advisor
By: Solomon Nartey Tetteh
Financial Advisor Gideon Morrison has urged Ghanaians to carefully assess their investment personality and risk tolerance before committing funds to any venture.
Speaking on the Business Breakfast Show on Zed 101.9FM, Mr. Morrison explained that every investor falls along a spectrum, from conservative to aggressive, and this distinction must guide investment choices.
“I may be an aggressive investor while another person may be conservative. Higher rewards come with higher risks, and you must be prepared for the possibility of losing everything on one investment,” he cautioned.
According to him, Ghana’s financial market offers a wide range of instruments tailored to different investor profiles. These include collective investment schemes and the relatively new Real Estate Investment Trusts (REITs), which allow people to pool funds into real estate projects without directly owning property.
Mr. Morrison also encouraged investors to thoroughly read prospectuses and documentation from investment managers before making decisions.
“If you don’t understand what you are reading, ask questions,” he advised.
Beyond individual investors, he highlighted a common mindset among Ghanaian entrepreneurs who prefer to maintain 100% ownership of their businesses, even when they lack the expertise to scale them successfully.
“In other markets, people are more willing to own 10% of a hundred-million-dollar business rather than 100% of a two-cedi business. Ghanaian entrepreneurs must begin to embrace shared ownership and partnerships,” he said.
The advisor noted that private equity (PE) firms present a strong opportunity, particularly for small and medium-sized enterprises (SMEs) in sectors like renewable energy and climate-focused businesses.
“A solar panel or greenhouse farming company can submit proposals to a PE firm and not only receive funding but also technical expertise to scale operations,” he explained.
Mr. Morrison stressed that successful investing requires focus, due diligence, and alignment with sector-specific opportunities. “It’s better to be a master of one than a jack-of-all-trades,” he noted.
