Types of Assets — What Can You Invest In?

Why This Matters

Before you invest a single Kwanza, you need to understand what you are buying. Angola’s financial landscape offers a growing menu of investment options — each with different risk levels, return potential, and minimum requirements. Choosing the wrong asset for your situation can mean lost money or missed opportunity.

The Asset Class Spectrum

An asset class (classe de ativos) is a group of investments that share similar characteristics and behave similarly in markets. In Angola, the main asset classes available to individual investors are arranged from lowest to highest risk:

1. Bank Deposits (Depósitos Bancários)

The most familiar starting point for most Angolans. Commercial banks offer several products:

• Current accounts (Contas à ordem): Instant access, 0-2% interest. Not really an investment — more a place to park daily spending money.
• Term deposits (Depósitos a prazo): Lock your money for 3, 6, or 12 months and earn 12-18% annually. BAI, BFA, and BCGA all offer competitive rates. Minimum deposits typically start at Kz 50,000-100,000.
• Foreign currency deposits: USD-denominated accounts earning 2-5%, useful as a hedge against Kwanza depreciation.

Advantages: Simple, familiar, insured up to limits. Disadvantages: Returns often lag inflation after the 10% withholding tax (Imposto sobre Aplicação de Capitais, or IAC).

2. Treasury Bills (Bilhetes do Tesouro — BT)

Short-term government debt instruments with maturities of 91, 182, or 364 days. Currently the 91-day BT yields about 18.5%. Sold at a discount to face value — you buy for less than Kz 1,000,000 and receive the full amount at maturity.

Advantages: Very low credit risk (government-backed), short commitment period. Disadvantages: Requires a securities account at BODIVA, minimum investment typically Kz 500,000.

3. Treasury Bonds (Obrigações do Tesouro — OT)

Longer-term government debt, typically 2-10 years, paying regular coupon interest. Kwanza-denominated bonds yield 20-22%, while USD-indexed bonds yield 7-9%. These are the backbone of Angola’s debt market.

Advantages: Higher yields than deposits, regular income, tradeable on BODIVA. Disadvantages: Longer lock-up, price can fluctuate if you sell before maturity.

4. Equities (Ações)

Ownership shares in publicly traded companies on BODIVA. Currently five companies are listed:

Advantages: Potential for capital gains and dividend income, part-ownership of Angola’s top companies. Disadvantages: Prices can fall, less liquid than deposits, requires market knowledge.

5. Real Estate (Imobiliário)

Property investment — residential or commercial — in Luanda, Benguela, Huambo, or other growing cities. Can generate rental income and capital appreciation.

Advantages: Tangible asset, inflation hedge, rental income. Disadvantages: Requires large capital (typically Kz 15,000,000+), illiquid, management overhead, legal complexities.

6. Foreign Currency (Moeda Estrangeira)

Holding USD, EUR, or other hard currencies as a store of value. The Kwanza (AOA) trades at approximately 914.60 per USD. Some investors hold foreign currency as a hedge against Kwanza depreciation.

Advantages: Protection against local currency weakness. Disadvantages: No yield unless deposited, exchange rate can move against you, BNA regulations apply.

The Risk-Return Tradeoff

A fundamental principle: higher potential returns come with higher risk. This is not optional — it is a law of markets. Here is how Angola’s asset classes line up:

Worked Example: Building a Simple Portfolio

João has Kz 5,000,000 to invest. Based on his moderate risk tolerance, he divides it:

• Kz 1,000,000 in a 12-month BAI term deposit at 16% → Kz 160,000 annual income (emergency reserve)
• Kz 2,500,000 in 3-year treasury bonds at 21% → Kz 525,000 annual coupon income
• Kz 1,500,000 in BODIVA equities (BAI + BFA shares) → potential capital gains + dividends

This mix gives João stable income from bonds, growth potential from stocks, and an accessible emergency reserve in his deposit. Total expected annual income: approximately Kz 685,000+ before dividends and capital gains.

Key Takeaways

• Angola offers six main asset classes: deposits, treasury bills, treasury bonds, equities, real estate, and foreign currency
• Each has a different risk-return profile — there is no “best” asset, only the best fit for your goals and risk tolerance
• Government bonds (OT) are the workhorse of most Angolan portfolios, offering strong yields with moderate risk
• BODIVA equities offer growth potential but require more knowledge and risk tolerance
• Diversifying across multiple asset classes reduces overall risk

Common Mistakes

Putting everything in one asset — Concentrating all savings in bank deposits feels safe but means missing higher returns from bonds and equities. Diversification is essential.

Ignoring liquidity needs — Locking all your money in 5-year bonds means you cannot access it for emergencies. Always keep 3-6 months of expenses in accessible deposits.

Chasing the highest return — The asset with the highest past return is not always the best choice. A 40% stock gain one year can become a 20% loss the next. Match assets to your time horizon and risk comfort.

What’s Next

You now know what you can invest in. But every investment carries some degree of risk. The next lesson teaches you how to understand, measure, and manage investment risk in Angola’s market.

Next Lesson: Understanding Risk — Why Every Investment Has a Price

Explore live BODIVA equity prices or browse the Bond Market Dashboard. Use the Portfolio Builder to experiment with different allocations.