Cuban investment play

The new US stance toward Cuba has some investors thinking it’s time to cash in. Others aren’t so sure.

With the US flag recently raised in front of the country’s embassy in Havana, some investors think it is time to look for opportunities in Cuba, reports The Fiscal Times.

An investment fund, the Herzfeld Caribbean Basin Fund, is already profiting on the upside. It holds 60 stocks from companies operating outside of Cuba that could gain from the new diplomatic overtures. Since its launch in 1994, the fund has grown by only 52.17%, but since December 16, 2014, the day before President Obama announced the new US stance toward Cuba, it has shot up by 31.94%.

There is also a website called Havana Cuba Business that carries the tagline, “preparing for post-embargo, post-Castro opportunities in Cuba.” It highlights US, Canadian and European corporations that are publicly traded and involved in or expected to be involved in Cuba-related business ventures.

Gregory Biniowsky, founder of Havanada Consulting, thinks Cuba presents many opportunities for growth. First of all, the lifting of the US travel ban and economic embargo should lead to a boom in tourism and in the economy at large. Cuba also boasts the best educated population in Latin America and it has low levels of crime and political corruption.

Not everyone is joining the Cuban investment fiesta. John Kavulich, president of the US Cuba Trade and Economic Council Inc. in New York, says US citizens “should be leaving their money in their US bank. It’s investment by romance. People are reacting in an aspirational way -- ‘Cuba is crumbling, it needs everything’ … We’re trying to sober people up.”