With the events in early February 2018 clear in their mind, stock market investors are once again rethinking the allocations in their investing portfolio. For most, traditional investments – like stocks – are posing more risk than ever to their wealth. To address this growing threat, much of the investment community is turning their attention to the safety of alternative investments to help them reach their financial and investing goals.
Over the course of the last decade, the alternative investment landscape has evolved to include many appealing options such as private equity, collectibles, and shipping container investments; to name only a few. This class of investment is populated by options that are widely regarded as business opportunities, as opposed to the traditional manner in which investors invest. Because of this, there is no longer a need for people to rely upon money managers to make investments on the investor’s behalf. These alternatives allow the investment community to take back control of their portfolio, and navigate their own financial future.
Alternative investments give investors more control over their money, their profits, and their returns. In addition to that, alternatives often provide a physical object/s that can been seen, and in some instance enjoyed by investors. This is perhaps the most appealing thing about these investing options. The fact that an investor can see what they are investing in, goes a long way to increase their confidence in the investment.
For investors who are looking to make the move away from traditional investments, alternative investments offer sanctuary from the volatility and uncertainty of the bond and stock markets, not to mention the turbulence associated with bitcoin and gold. After a decade of struggling for gains, investors are tired of the constant strife associated with conventional investments. Nowadays, they want alternatives, options, and choices.
Traditionally people relied on investment advisers for insight and direction. Nowadays the world wide web provides investors with a wealth of information.
The average investment-seeker does not know where to begin their search for profitable investment opportunities. This is why so many people rely heavily upon money managers and financial advisers for insight and direction when investing. Although traditionally this has been the accepted strategy many have taken to reach their investment goals, investors are learning that there are a number of other resources that can be relied upon to help them make important investing decisions.
The world wide web has introduced investors to a wealth of information. This has come in the form of blog posts, investment forums, investing communities, and online reviews. Albeit there are a great many instances where people are simply sharing their personal opinion, there are also valuable first-hand experiences to be found. An investor’s own account of their exposure to an investment product has value beyond that of someone’s sentiment; agreed?
There are undoubtedly people who spread information that is untrue and benefits only themselves. No one likes being lied to. Thus, to reduce the chances of this occurring when sifting through online content, investment-seekers should make every effort to reach out to the sources of their information. Like a journalist or detective, dig deeper and make contact with people who are “in the know,” and can add value to your inquisition. Avoid opinions at all costs and stay focused on the genuine facts.
Even though new investors are discovering they do not have to rely solely upon the information provided by bias, misinformed investment advisers, it is still important for them to verify the credibility of their alternative, internet sources. Without a doubt, whether online or not, carefully vetted information is the key to any investor’s long-term investing success.
Having to make a choice of which investment opportunities are right for you is difficult. Each investor, yourself included, has their own investing criteria and process they will follow when choosing investments. For myself, I follow a three “r” measurement, which carefully considers the investment’s associated risk, region, and reward.
Carefully considering the risk associated with an investment is not a new strategy for investing. However, making a proper assessment of your tolerance for risk is very important. It is much more than your personal feeling about an opportunity. It factors-in your investment timeline and investing goals to give you a true picture of your ability to handle risk. Doing so can identify opportunities to invest that have a higher rate of return, and may have been overlooked by a timid investor’s strategy.
The economic growth in regions undeniably affects the performance of investments in that area. At the moment, the Asian region is demonstrating prosperity and is providing profitable options for investors. An example of this is container shipping investments from Davenport Laroche. The company operates out of Hong Kong, a shipping mecca that services a great number of the world’s container shipping lines.
Clearly, the rate of return is of primary interest to every investor. It is paramount in achieving financial goals. Savvy investors know that identifying investments that pay consistent returns can be used to supplement income or reinvest to build wealth more quickly.
It is understandable that investors will have additional factors they would like to consider when choosing investments to add to their investing portfolio. The three “r” measurement – Risk, Region, and Return – I have shared above is most valuable to those investment seekers who feel overwhelmed by the number of options they have encountered, and need help making a “short list” of investments to pursue.
If you are an investor in the stock market, you must be aware that analysts believe the United States’ stock market is overvalued, and due for a correction. At this point in time, it would be wise for you to carefully review your investing portfolio and sell investments in the stock market that pose unnecessary risk to your financial security. This will leave you with vacancies in your investment portfolio that need to be filled, as soon as possible.
When you are looking for new investments to introduce to your financial portfolio, be mindful of your investing road map, as well as the strategy you have in place to achieve your investment goals. For example, if stock you own pays dividends, you will need an income generating asset to immediately replace it. This is particularly important if you are using investments to supplement your income.
Among the leading income producing investments in the marketplace are hard assets. This class of investment includes investing in containers, collectibles, and real estate; to name few. Investors consider these to be a much more appealing option because they are tangible assets, that can be seen and touched. For many investors, this lowers the associated risk and raises the investment’s overall appeal.
When choosing investments, there is an enormous amount of research that must be done to satisfy your questions about risk and return. At the moment, you have likely discovered that the stock market is in a precarious position, and that poses a risk to the investors – yourself included – who have investments in stock. To avoid a financial crisis when the markets correct themselves in the near future, stock market investors should move away from the perils of Wall Street and invest their money in safer investment options, with similar or greater investing rewards.
The investment community is full of investing opportunities. Some of the available investments are more appealing than others, as decided upon by an established set of risks and rewards. Based on these risks and rewards, investors will decide which options fit into their portfolio and best helps them achieve their investing goals. Regardless of the opportunity, expect that experienced investors will heavily scrutinize the benefits and dangers of each individual option.
There are a number of factors that help investment seekers determine the amount of risk associated with an investment opportunity. Some of these include the company’s brand reputation and value, as well as established performance and potential for future industry growth. If an investor is satisfied with the corporate outlook, the risk may be considered acceptable. If there are aspects that are troublesome, or are cause for worry, investors would be wise to discount and avoid those investing options.
An investment’s return on investment (ROI) plays a vital role in the investor’s portfolio performance. The investment reward is important, in that investors rely upon it to move them closer to their financial goals. Moreover, an investment’s reward is sometimes used in determining the risk of investing. When returns are high, some investors have an increased tolerance for risk. This is why options are best studied and reviewed on an individual basis.
It is undeniable the influence that risk and reward has on investment seekers’ decisions when choosing investments to add to their portfolio. By carefully following their investing road map, investors will be able to identify investments that move them forward toward building personal wealth, all the while maintaining an acceptable level of risk in their portfolio. In some instances, this will require that investors exercise self-discipline and carefully weigh risk and reward before making the decision to invest.