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Alternative Investments 2023
What is it? Why should you consider investing? How can I make money investing? What are the risks? How much can I make? Let me get your attention…
It could be the difference between you buying the Birkin bag, sending the kids to university, and having those dream holidays.
$50,000 invested at 7%
Let’s start with the basics, alternatives are a non-correlated asset class, if that didn’t make any sense, let’s unpack that so we have a base line.
The mainstream investments would be made up of Stocks and Shares, Mutual Funds, Fixed Income instruments, and move generally with the flow of the financial conditions of the economy. For returns expect 3-7% per annum average over 10-15 years.
Alternative investments generally will not move the same up or down, this asset class includes Private Finance, Angel Investing, Wine, Micro Loans, Antiques, Art, and certain types of Property.
The returns can be more rapid you can expect 7-10%++ returns per annum as there is more risk variability with this type of class. Typically you should invest 20% of your Net Worth.
Example Opportunities to Invest in Private Credit Finance Minimum 90k AED
- 7% Fixed interest for 12 mths... Year 1 you receive $20,448 then roll over or redeem in full.
- 9% Fixed Interest over 3 years… Receive $24,446 roll over or redeem in full.
The Example Investment is part of a pot of £53Million and the fund behaves like a private lending organisation secured against developments in a specific affluent belt of the UK. The Investment team is built of previous directors of Multi Million Pound organisations like Ernst & Young, UBS, and the Foreign Office.
A loan note is issued in your own personal name, the fund has been running for 5 years and is privately owned. Rates are paid at 7,9 and 10%. Fidelity recently produced an article “opportunities in Private Credit” so this is a hot topic for investment.
Some Questions to ask:-
- How liquid is the investment, do I have an exit, do I have a secondary market? When can I get my capital?
- Is the investment held in my name? Issue certificate or Share certificate?
- What is the due diligence carried out on the Company?
- What is their track record? Historical interest received and redemptions issued on time.
- What if anything is my money secured against – Is it a physical Asset like Land or property?
The biggest risk I would advise in any investment after 23 years as a Financial Adviser, is many women do not have a seat at the table. That’s the biggest risk facing women today. Find an adviser you trust and just do it.
Article by Helen Louise Morris MCSI firstname.lastname@example.org 00971 507885759
Helen has been a Private and Corporate Adviser for Wealth, Tax and Trusts for 23 years.