Three different options
Egyptian savers often choose between stocks, real estate and bank products. This article adds participation in a solar asset and compares the differences and risks of three options. None of them is right for everyone.
Stocks (EGX)
- Return: variable — dividends and price changes; losses are possible
- Risk: market swings, company-specific and political risk
- Liquidity: generally high, but at the market price at the time of sale
- Sharia: depends on the company — requires screening and follow-up
- Effort: requires knowledge of the market and the companies
Real estate
- Return: rental income (if let) plus or minus changes in value
- Risk: market cycles, vacancy, tenant issues
- Liquidity: very low — selling can take months or longer
- Sharia: generally considered permissible
- Capital required: usually high; maintenance costs and property taxes apply
Solar participation (pv.direct)
- Return: projected annual distribution range — not guaranteed; from electricity revenue actually paid by the offtaker
- Risk: production below expectations, late or missing payment by the offtaker, operating costs, contract terms and market conditions. The installation is a real asset, but that does not remove these risks.
- Liquidity: exit requests require at least 6 months notice and follow the project contract and resale process; capital return per the agreed formula, subject to contract and outstanding obligations
- Sharia: designed to align with Sharia principles (e.g. Musharakah-style participation in a real asset); obtain your own advice or certification if required
- Effort: pv.direct handles operation, but you should read and understand the contract
Side by side
| Aspect | pv.direct participation | Stocks | Real estate |
|---|---|---|---|
| Source of return | Paid electricity revenue | Dividends and price changes | Rent and value changes |
| Return | Projected range — not guaranteed | Variable, losses possible | Variable |
| Main risks | Production, offtaker payment, costs, contract | Market swings, company risk | Market cycles, vacancy, maintenance |
| Liquidity | At least 6 months notice; contract and resale process | Generally high, at market price | Very low |
| Sharia | Designed to align with Sharia principles — obtain your own advice | Depends on the company | Generally considered permissible |
| Effort | Read and understand the contract | Market knowledge needed | Management and maintenance |
How to decide
No option is best in every situation. Consider your time horizon, when you may need the money, how much fluctuation you can accept and your personal Sharia requirements. Read every contract carefully and obtain independent advice where needed.
Important: Projected figures are illustrative only — not guaranteed. Returns depend on energy production, customer payment, costs, contract terms and market conditions. This article is general information, not investment advice.