Alternative Investment Opportunities Available In The Market

Traditional ways of investing would be going to shares, bonds, mainstream property, cash, and other traditional asset classes. But there are more unusual, yet highly rewarding opportunities called Alternative investment, usually embarked on by smart investors because of the risks involved in it.

Here are alternative investment ideas ranked from safest to riskiest, that are available in market:

1. Structured products

This is basically a contract with a financial institution to pay you a defined return at a defined time depending on the performance of the stock market. It’s the safest of all the other alternative investments. The only way you could lose money is when the stock market is performing catastrophically badly.

2. Bridging finance

These are short-term loans used by property buyers who are expecting to get a mortgage from the bank but cannot wait for the approval. For private investors, you can invest in funds that pool bridging loans, in order to spread the risk across several borrowers. The loan is secured against the property.

3. Peer-to-peer lending

Investors meet with individuals or businesses who want to borrow money. Borrowers can get lower rates than they would be charged by a bank, while lenders can earn more money on their savings than they could from a cash account. It can be quite risky for the investors because the individual or the small business might default or become bankrupt.

4. Forestry

Returns from investing in woodland come from any increase in the value of the land and the trees on it, and any income produced by felling trees for timber. But increase in the value of the land is only good if you can also sell the forest. There are some excellent tax breaks in the market, with no income or capital gains tax to pay and exemption from inheritance tax if you hold your investment for two years.

5. Buy-to-let property

The property will form a large part of your overall wealth. You need to have at least 25% of the value of the property to use as a deposit, plus extra to cover any refurbishments and legal fees. Investors will likely face competition from professional landlords and may have to deal with rogue tenants and maintenance issues.

6. Stamps

Rare stamps will have value as long as there are stamp collectors. The most valuable can fetch six- or even seven-figure sums. Stamp values can keep on going higher, and you can search for offers for private investors.

7. Coins

Rare coins are best bought through a reputable auction house, which will provide a money-back guarantee should the coin turn out to be a forgery. As with stamps, the value is underpinned by the popularity of coin collecting as a hobby.

8. Winery

The traditional way to invest is through established wine merchants. You must have knowledge on fine wine and their exact records. More recently, wine funds have been launched which offer an alternative way to access the market. Some of these qualify for the Enterprise Investment Scheme (EIS).

9. Business Angels

When you become an angel, you invest in smaller companies that are not quoted on the stock market. Typically, you won’t see any return until the business is sold or floats on the stock market. It could take years, and you could either lose all your invested money, or reap triple returns.

10. Equity crowdfunding

This is very similar to business angels, but managed wholly online. Investors can either deal directly with the company and get your name on the shares, or let the crowdfunding website deal on behalf of hundreds or thousands of investors. However, if the business you invested in does well, a bigger investor may buy it.

11. Diamonds

Gemstone-grade diamonds have increased nearly tenfold in value since the 1960s. The diamond price is much less volatile than the price of gold. But it may be difficult to access for investors because diamonds are valued subjectively by experts.

12. Carbon credits

A carbon credit is essentially a permit to release one tonne of carbon dioxide into the atmosphere. Companies that exceed their allowances are supposed to buy more credits, according to global cooperation. Private investors have been targeted by firms trying to sell them carbon credits. This is a highly specialist market and best left to professional traders.

13. Land banking

Land banking companies take a piece of land, parcel it up and sell it off to investors; hoping that once the land is earmarked for development, it will soar in value. However, there is often no development and investors are left holding a useless piece of land either in the market or overseas. A lot of land banking schemes have been stopped by the Financial Conduct Authority (FCA).

Tips For Selecting the Best Investment Company

In terms of making the best investment, most individuals do not know exactly where to start. Bear in mind that investing is a fierce industry. Those who are not fully aware of what they are doing might end up losing their hard-earned money. And it is for this reason that most investors would want to get help from a reputable investment company.

3 Important Factors

If you start looking for an investment company, you must determine the 3 essential factors. First, you need to clearly identify your goals. These experts cannot actually help you if you do not have a clear goal. Second, new investment must perform some research regarding the background as well as the reputation of the company they want to work with. You have to make sure that it has an excellent track record and has received optimistic reviews from other investors. And third, you need to know that kind of relationships you want with the investment firm. Determining these factors will greatly help you in boosting your chances for success.

Choosing Your Goals – Your goals will have a huge impact as to what investment firm to work with. Most people today invest with 3 goals in their minds – to increase their wealth using minimal start-up funds possible, to reduce their chances for risk or loss, and to hire experts who can capitalize on all of the great opportunities accessible to them. It is actually okay for you to have different goals; however, those goals must be clearly laid out in a list prior to choosing an expert to work with.

Perform Research – Due to the fact that most people do not invest, they do not actually know how to perform research in an investment company. Well, there are also 3 things to consider – marketing materials, public trading records, and financial statements. All of these elements will yield a larger picture of how well an investment company is doing. It is important for you to look into how the company was performing in the past 5 years. Also, observe how the group performed while the market was both down and up. These pieces of information will help you properly evaluate your options.

Consider The Brokers – Few brokers are well-known in most markets. New investors like you must familiarize yourself with the career paths of the top performing brokers. Be reminded that it is normal for brokers to change companies from time to time. You must know how the companies were performing when such brokers worked with them. Moreover, you must also be aware of how the companies performed after they have left.

If you want to increase your finances, consider making investments. Be sure though to work with the best investment company to ensure success.

Of course, you would want to work with investment firms that can meet your needs. Be aware that your overall relationships with these experts will greatly determine your long-term satisfaction and success. If you want to invest in the oil and gas industry, check out this site.

How to Invest Your Funds Smartly

Starting a new business can be a very tedious task that comprises of several steps and decisions. Cost plays a very important role here. It is not a rarity to hear about the startups that start with a very positive sign to be closed down due to the lack of financial resources. So you should be very wise in spending your money if you really want your business to remain profitable in the long run. Here are some tips for the same.

Due Diligence

Before you decide to invest any amount you should know the returns it can fetch you. Many times the startups invest the funds lavishly as they are supported by angel investors. But when they fail to bring in the objected returns the rotations stops and they stop getting any help that situation is detrimental to the startup entities, so always make a plan before investing.

Be Miser

It is also important to invest as small as possible. To be precise instead of investing a large amount at once you can better break it into different parts and then invest in a strategic manner in different phases. You can have a projected returns on each phase. You can proceed only after realizing those returns.

Demand Value

You can also afford to spend more if you are getting a good value out of it be it in terms of performance, quality items or the reputation.

Have a Passive Income

Though you should avoid too much indulgence in passive income as it can act as a hindrance to our startup’s growth you can always have a certain amount invested in securities, stock market, real estate and other entities where you can get the passive income It will prevent you from getting boot strapped.

Pay Yourself a Salary

One of the best ways to keep yourself from being bankrupt or bootstrapped is start a habit of paying yourself a certain salary every month apart from the profits you earn. It will help you to remain profitable even in the unlikely event of your business faring badly.

Rope In Partners

Another thing that can make your startup run smoothly with adequate finds is roping in several partners. You can find out the business entities that belong to the similar field that you are working in. For example if your field is hospitality then hotels or travel agents can be an ideal partner. It will help you to get more funds.

The finance is as important to startup as the fuel for the vehicle so it is important to invest your funds smartly in fact if you know how to invest your funds smartly in the startup then you can reach great heights.

To Win on Financial Markets, Know the Difference Between Gambling and Investing

Before you buy/sell an asset, you should be clear on why you are doing so. Is it that an asset price is rising and you buy in the hope of making a quick buck? If this is the reason for your purchase but you cannot sensibly identify what’s pushing up the price, I call this gambling, not investing. Your action is based on the hope that you will gain but not informed by any analysis of what will cause the gain.

Far too often I have met people who get into assets for no deeper reason than: all my friends are getting into this; look how much its price has been going up; a relative (with no record of excellence in investing!) told me I should buy. These people are brave gamblers.

When the price of gold was rocketing up a few years ago, several persons asked if I wasn’t joining the gold craze. I asked them to identify specific factors driving the price of gold. The only response two of them gave was: “Well, it has been going up so much. I can’t imagine it wouldn’t go up more. If you don’t get into it, look how much you could lose.” They were gambling, not investing.

When you are investing (buying, selling, selling short, etc.), you will always be able to specify what you think will influence the price of the asset. You may turn out to be wrong and might have to change your investment. But the point is, you will not just be leaping in the dark in the hope of landing in a grand place. You will be learning to identify what drives asset prices and, hopefully, with experience and thought, become better at it.

For example, when Apple announced its earnings on Jan 27, 2014, its stock price fell sharply. Suppose I had bought shares of Apple, thinking that because the share price had fallen so sharply, it was definitely going to recover. Unless this belief was rooted in technical analysis and/or a lot of experience with how Apple’s stock price would bounce back up, I would call this purchase a gamble.

Suppose, however, I had bought Apple well aware that its earnings weren’t great, but based on clear indications that it would be creating new products that would push up the stock price. This purchase would not have been based on just a wish or hope. It is what I call investing.

There is usually an abundance of information on the internet on what influences asset prices. A little research and a willingness to think can tell us what is likely to drive an asset price. If we are unwilling to do this research and analysis, we may be better off not risking our hard-earned money.

We are always told that the odds of winning in casino gambling are typically very low. If we view the financial markets like a giant casino, we should not be surprised if we lost badly.

3 Investment Options To Top Up Your State Pension

We all dream of having a beautiful life when we get old. Unfortunately, the state pensions aren’t enough. While this is the case it doesn’t mean that you can’t have more money at your disposal when you retire. To help you out, here are some of the ways in which you can top up your state pension:

Invest in stocks

A stock is a share of ownership of a company. When you own a share of a company you have a right of claiming company assets and earnings. The more the stocks you have, the more the ownership of a company you have. Stocks are attractive as ways of investing for retirement as they are long term. You also get to receive dividends at the end of a financial year.

While they are attractive, they also come with their fair share of risks especially if the company collapses or the shares lose value. To protect your money you need to research a lot before you invest in a certain company. There are plenty of technicalities involved with the buying and selling of stocks; therefore, to have an easy time find a reputable stock broker to handle your money. The blocker will guide you on the best company to invest in and any other intricacies involved.

It’s often said that you shouldn’t put all of your eggs in one basket; therefore, it’s wise that you spread your investment in different companies.

Try out bonds

A bond is a debt security. Bonds are attractive in that they carry a low risk compared to shares. When you buy a bond, you will be lending money to a federal agency, municipality, government or corporate entity. Upon investing in a bond you receive an interest during the life of the bond. Once the bond matures, you receive back your money.

Just like when buying shares, you need to take your time to research about them. Closely read a prospectus and gather as much information as you should.

Put your money in Real estate

The real estate sector is stable thus a great place to invest for the future. There are many ways of investing in the real estate. You can buy property for development or buy land and leave it idle for its price to rise. The trick to buying property is investing in areas that are growing fast thus your property’s value also rises fast.

Conclusion

These are some of the ways of topping up your pension. If you have the money, you should consider investing in all of the different ways for a comfortable future life.

 

Is a Monthly Income Bond Worth Paying For Every Month?

Most investment plans pay either annually or bi-annually. Stock gives you the earnings quarterly, but there is a lot of risk when investing in the stock market. Therefore, this bond has been introduced to help you build a portfolio which can pay dividends every month. This investment product can ensure you have a reliable income after retirement to help pay your living expenses.

When you invest your lump sum in a monthly investment plan, then the bond issuer gives you the coupon payment (interest amount) monthly on the investment, however, the interest is calculated daily.

There are several benefits over other types of investment which are listed below, if you invest your savings in a Monthly Income Bond:

Lucrative & Less Risky:

This type of bond is labeled with good monthly returns and is also less prone to risk. These are the reasons that make this product a lucrative deal for investors. Your capital amount is safe and the interest amount will transfer into your account every month. However, the amount of interest may vary with inflation, but won’t stop the monthly payments.

Tax Exempted:

Investors can build a good portfolio investing their money in this type of bond. The interest amount is paid tax-free, which gives them the freedom to reinvest the returns and build up good savings. This is the reason why the majority of people in the UK rely on this type of bond to secure their future financially.

Income for Retirement:

This is the best investment plan for retirees or people who are near to retirement. Fulfilling basic expenses becomes the biggest problem for retirees, when there is no source of income available, and pension income is not enough to make ends meet. It becomes necessary to look for an investment plan which can provide a monthly income. Hence, these types of income bonds are best to solve financial difficulty.

Free to Invest with your Capability:

It doesn’t matter how much savings you have – you can invest as per your circumstances in this bond product, and earn regularly. You can also strengthen your portfolio by investing in several income bonds at the same time.

If you are willing to invest your lump sum in a volatile bond product, then choose this product. But, if you can’t take the risk of variable interest rates, then you can also opt for the fixed monthly income bond. This is the best alternative solution for retirees to earn a fixed amount of return.

The majority of people in the UK are very concerned about their savings and investments. If you are approaching retirement and you have a mortgage and utility bills, and several other expenses to pay every month, then you need an investment plan which can give you a regular income after retirement. Monthly Income Bonds are the best investment product to pay you interest every month.

Investors Benefit By Finding The Most Up To Date Information

Finding ways to deal with market volatility and minimizing the risks associated with financial transactions can be of paramount importance. Investors who have access to the most complete and up to date financial news are far more likely to make effective and successful decisions. Educational resources, news sources and other assets can play a major role in ensuring investors are met with greater success.

Investing in stocks, bonds and other financial assets can be very profitable. Creating and maintaining an investment portfolio able to provide superior returns often requires a great deal of insight and information. Knowing where to find the latest news detailing the trends and developments shaping financial markets is often the first step in creating a more effective investing strategy.

Novice investors who lack experience in dealing with various markets often require the guidance and assistance that only a professional may be able to bring to the table. Seeking out a brokerage, financial advisor or other industry professional is often a smart move. A little assistance can go a very long way for those who are just beginning to explore the world of finance.

Making frequent trades and investment strategies that require a more active approach may be of tremendous benefit. Lacking insight into financial markets can make it far more difficult to determine the appropriate time to buy or sell stocks and other assets. Investors who have access to the best news and information are far more likely to make the right investment decisions.

Financial journals and other major publications often contain a great deal of useful insight and detailed information regarding major market trends and forecasts. Keeping track of the big picture is always a good idea, even for investors who plan on making multiple trades during a relatively short period of time. Reading up on the latest market news can help ensure that investors are able to make smarter decisions.

Software, applications and other financial services that allow trades to be made more quickly, easily and with less overall cost can also be an important asset. Dealing with a brokerage that takes too long to process a transaction can be a major liability. Investors who plan on adopting a faster paced investment strategy would be wise to ensure they have access to the right resources.

Performing a little research in order to craft the right investment strategy can make a real difference. Making investment decisions without a proper understanding of the market, financial forecast and circumstances may be nothing short of a disaster. Investors who make an effort to prepare themselves in advance are more likely to find success with their efforts.

Access to up-to-date financial news will ensure that investors are able to benefit from a better understanding of their circumstances, options and opportunities. News sites, publications and other resources that allow investors to trade stocks, bonds and other financial assets with greater ease and success can be a crucial asset. Day trading without the right information can lead to increased

5 Keys for Startup Investors

Hundreds of thousands of businesses are formed every year. Many of them are in significant need of capital, presenting opportunities for investors.

While startup investing is not for everyone, those with a high risk tolerance can find it a stimulating and potentially rewarding pastime. The possibility of getting in on the ground floor of the next Uber or Facebook, speculative as that might be, can be compelling.

Suppose you hear about an exciting new company looking for investors. You are aware that a majority of startups end up failing within the first few years, but you think this one could hit it big. What do you do?

1. Check out the Management

You ultimately are investing not just in a product or an idea, but in the people running the company. No matter how innovative or promising the business concept may seem, the enterprise is unlikely to succeed without capable management. You should assess not only the founders, but also those promoting the investment. An initial review often can be done online. In the case of those with professional licenses (such as brokers, accountants, and attorneys), you can check their license status and any disciplinary history. You want the people running or associated with the company to not only have clean backgrounds, but also a record of success in other ventures. Look for qualities such as experience, intelligence, creativity, integrity, discipline, and leadership ability.

2. Determine How the Business Will Make Money

Lots of companies are based on an intriguing concept. But the company must be able to translate that concept into a product or service that it can produce and sell at a profit and in sufficient quantities to generate reasonable cash flow. What is the startup’s monetization plan? What is the market demand? Who are the competitors? What is the marketing strategy? Is the business scalable, having the ability to grow rapidly without sacrificing quality or profitability? If the company is unable to provide good answers to these questions, its likelihood of success is dubious.

3. Rely on Advisors

If you are buying a used car, it is good practice to hire a mechanic to look the vehicle over to make sure you are not getting a lemon. The same principle applies in evaluating a startup. It is crucial to use qualified professionals, such as an attorney and accountant. Make sure your advisors are familiar with startups-an attorney specializing in personal injury cases probably will not be a good fit. You may also want to consult with experts in the business sector in which the startup operates. Your advisors will provide various insights you would not have on your own. They also will help you command respect from the company.

4. Thoroughly Research the Startup

Ask lots of questions and request lots of documents. If the business is concerned about revealing confidential information, it can have you sign a nondisclosure agreement. You and your advisors will want to examine the startup’s business plan, offering memorandum, financial statements, budgets, capitalization table, and corporate documents (articles, bylaws, prior investor agreements, etc.) If the documents are shoddy or incomplete, that is a bad sign. Be wary of internal financial statements; statements prepared by an outside CPA have more credibility. Audited financial statements are best, but are less common because of their expense. If your investigation raises red flags, insist on complete explanations.

5. Review the Investment Documents

Your advisors can be of great help here. At the very least, you want to be fully informed as to how the deal is being structured and what rights and obligations you and the company will have. Your attorney can advise you as to what document changes might be in your best interests and help you negotiate with the company. Your accountant can let you know whether the valuation seems reasonable. Do not proceed unless everything is fully documented. You should not invest based on a handshake or mere verbal assurances.

Startup investing requires patience and hard work. Although there are no guarantees, you can reduce the risks and boost the chances of success by following the principles discussed above.

 

Savings and Investments – How Are They Different?

Savings and Investments are absolutely important for every citizen. They can be used in various ways to meet expenses but it must be understood that there are some major differences between the two.

Economists and bankers always advise that ‘savings’ as a habit has to be learned at a very young age; this essentially teaches the value of money in a small way and helps to understand macroeconomics at a later stage. Saving money and investing money are two completely different concepts altogether; savings is part of the money left over after monthly or annual bills and expenses have been met or keeping aside a certain portion of the income. Savings are generally used to deal with unexpected expenditure like an illness or unforeseen accident, home repairs, educational expenses etc. It can be a pre-fixed percentage of total earnings like 10 percent or 20 percent. In other words, savings is hard cash ‘saved’ from expenditure by being cautious or avoiding an expenditure altogether. Investments on the other hand pertain to that certain sum of money put aside in financial products or systems to generate returns and increase incomes.

The three prime factors where savings and investments differ are:

• Time – savings usually cater to short-term needs unlike investments that need longer durations of time from a few months to a few years to generate returns.

• Liquidity – savings are the most liquid of assets as they are accessible at any time. Investments however cannot be liquidated immediately and may take from a few days or a few weeks to attain liquid status.

• Risk and reward – the risk factor with regard to savings is almost negligible but do not see much return as compared to investments, which may be fraught with risks. But investments that are done wisely – for e.g. in gold, mutual funds, shares and stocks etc. – can help fetch manifold returns over a period of time.

That said, we find that many a time when savings is easily accessible, the tendency is to dip into it and take money when the need arises – a celebration dinner or graduation party, automobile repairs, a sudden trip etc. Financial planners are of the view that those who set aside a portion of their monthly income aside before chalking out expenses are better able to meet unforeseen expenses because they are able to build savings and reduce debts. To help prevent depletion of savings funds, the best strategy is to set up an automatic transfer to a savings or investment account that has a lock-in period which makes it rather difficult to liquidate the money even if a need arises.

The two essential strategies to boost savings and investments are: (I) increasing income and (ii) reducing expenditure.

Some Useful Investment Tips And Advice For Retirees

People nearing their golden years usually focus on saving or amassing enough money so that they can have an enjoyable and stress-free retirement, Once they are officially retired, investing for them is typically out of the question. However, financial advisors say that individuals can also reap several benefits when they still invest even when they are already retired.

But whether you are young or already retired, making smart investment decisions and getting the most out of them will depend on following some useful tips and advice. For retirees, below are some helpful tips and advice worth following to ensure that they make the right, profitable investment decisions:

Don’t focus on only one risk. All types of investments come with certain risks. This is especially true when you invest in the stock market. However, retirees should know that avoiding stock market risk increases other types of risk. These include longevity risk or the risk of outliving your money. Financial advisors say that retirees should not consider short-term or certificates of deposit and other similar types of investment as being risk-free assets. This is because if you invest in them, you may still have a guaranteed return of capital. And this is an investment risk worth taking.

Don’t rule out bonds. Bonds still play an important role in any conservative investment portfolio designed for retirees. Most financial and investment advisors recommend retirees to invest in high-quality bonds, such as Treasury bonds or highly rated corporate bonds, and individual bonds or bond funds. However, retirees should stay away from high-yield bonds and high-yield bond funds since they are too risky.

Diversity your real estate investment trusts. Real estate investment trusts or REITs are investing option that provides diversification and generates income for retirees. However, to get the most out of this investment option, retirees would do well to diversify their portfolio. This means investing in commercial property such as warehouses, office buildings, and shopping centers and not just in residential properties. In addition, retirees investing in an REIT will do well to make sure it is diversified not just geographically but in terms of the type of commercial property. This is essential for diversification, stability, and for dampening volatility.

Consider investments that offer immediate annuities. Lastly, if you want a guaranteed income payout, annuities are a reliable option. With annuities, you get a monthly income in exchange for a lump sum or payments over a series of years as long as you live. There are various types of annuities and they come with different features. They can be expensive as well. As such, consider consulting a trusted financial adviser first before you deciding which type of annuity to invest in.