If you’d like to diversify your portfolio, alternative investments are well worth looking into. Investments like these can provide you with high rewards, although as with all types of investments, they also come with an inevitable element of risk. Therefore, the key is to research exactly which type of alternative asset is best for your portfolio in order to reap the most fruitful rewards possible.
If you’re at all unsure of your territory here, Ignite Invest is a company that will be able to assist you in making decisions every step of the way. Here, we offer some broad-brush information on alternative investments so you can begin to think about the kinds of options that are open to you.
A Diversified Portfolio
What is an alternative investment? In a nutshell, these types of investments are considered to be “alternative” because they are not classified under any of the conventional categories of cash, bonds,or stocks. Financial assets such as venture capital, property,and hedge funds; and tangible assets such as art, antiques, coins, or stamps, are all classed as examples of alternative assets.
By nature, alternative assets can be relatively illiquid and can therefore be more difficult to sell quickly if needed. It can also be harder to accurately quantify the value of these assets, especially if they’re rare or unique.
Having these investments in your portfolio can still be beneficial, though. However, precisely because they are considered to be high-risk, it’s best to ensure that they make up only a relatively small part of a wider portfolio. If you’re planning on taking the plunge, some of the most popular and best alternative investments are below.
The Best Investments
After changes to permitted development rights, B1 commercial properties can now more easily be redeveloped and converted into residential properties. Alternative property investments like these can proceed quickly because developers no longer need to acquire complex planning permissions. Once a commercial property has been converted into individual units, it is likely to have increased gross development value.
Strategic land development can also provide significant returns. Additionally, it can provide a great way for investors to diversify their portfolios. Even during a global pandemic, land investments are alive and kicking. Acquiring strategic land as an investment is similar to crowd funding and Ignite Invest already has significant experience in this enterprise.
Consumer Litigation Financing
Consumer litigation financing or funding covers the costs of cases that involve individual consumers. These cases are relatively low-stakes in general, sometimes relating to small claims. Invested funds can help solicitors increase their capacity to take on no-win, no-fee cases, which inevitably carry a degree of risk. These alternative investment opportunities have been known to generate a significant return on investment (ROI).
Homes of Multiple Occupancy
All types of investors can invest in homes of multiple occupancy (HMO). Investors can choose to invest in the acquisition and refurbishment of properties, or they can take ownership of tenanted properties. Either way, in a difficult housing market for buyers, HMOs are currently in high demand and are considered to be a high-return investment.
Approaching how to invest in alternative investmentsand gaining access to the wealth and diversity of opportunities out there can be difficult, but Ignite Invest can help you spread your portfolio in the most effective way possible. Even in the midst of difficult economic climates, we can work with you to make sure that you take the right steps. For more information, call us on +44 203 355 1178 or email us at firstname.lastname@example.org.
Frequently Asked Questions
Are HMO properties a good investment?
Yes, HMOs remain a good investment. In fact, many informed investors are aware that alternative investments like HMOs offer rental yields thatcan’t be achieved with traditional buy-to-lets. What’s more, the demand for flexible and affordable housing offered by multi-let properties is higher than it has ever been.
What is a loan note investment?
A loan note is a legal contract that states the amount to be invested, the loan’s duration, and the interest rate that has been agreed upon. This is a useful way of raising funds for commercial purposes, usually by companies seeking to raise capital or those involved in property orlitigation funding investment.
How does a loan note work?
Loan notes are a type of IOU where an investor agrees to make a loanto the company. Then, the latter agrees to pay it back later in the future, typically with interest.
A loan note can be transferred provided the terms and conditions allow it. A professionalalternative investments companylike Ignite Invest can guide you through the process.
Is UK commercial property still a good investment?
Commercial property has been considered one of the betteralternative property investments in the UKfor a while now. The initial payments needed for the building process, including any necessary renovations for tenants, willprobably be higher in comparison to residential buy-to-let properties. Nevertheless,such an investment offers a much higher ROI as well.
Why is investing in ecotourism a worthwhile proposition?
It is worthwhile investing in ecotourism because this activity contributes to the preservation, conservation,and stewardship of natural and cultural resources. Local residentsgain many social and economic advantages, boosting the longer-term success of the project succeed in the long run. The degree of interest worldwide in environmental causes, as well as the feel-good factor from contributing to the overall health of the planet, means these types of projects are worthwhile in many respects.
List Of Ways You Can Invest In A Property
Here are various ways to invest in a property with the help of alternative investment management companies like Ignite Invest:
- Direct investment. This is where financial asset investmentscompanies or private investors take a share in or sometimes buy a whole property by themselves. This is not always the most practical investment choice, especially for those new to the market.
- Direct commercial property funds. This is also called bricks-and-mortaralternative funding, and is one of the most common ways to invest in properties through collective investment schemes. These include unit trust, investment trust, or Oeic schemes.
- Indirect property funds. This collective investment scheme invests in the shares of property companies that are listed on the stock market. Unlike direct alternative investment management, property shares for thiscan move up and down alongside the stock markets.
The Biggest Pros of Investing in HMO Property
Here are some of the benefits available from investing money in HMO properties:
- Better yields. HMOs are considered high return alternative investments as they can offer up to three times higher rental yields than standard properties.
Many investors consider HMOs as a good choice forstrategic land investment.
- Fewer void periods. As HMOs cater for more tenants than standard rental properties, there is less of an impact on rental income if one or more tenants move out.
- Arrears are less likely. Again, with a greater number of tenants inhabiting the property, issues such as rent arrears are less likely to affect the overall ROI over time.
To find out more about a wide range of potentially profitable investments for your portfolio, contact us today. Our team of tangible asset investments professionals can guide you through the process.