Want to Diversify Your Portfolio? These are Some of the Investments with the Best Return

There are hundreds of different ways you can invest. From putting money into mutual funds or even individual stocks to investing in someone else’s business or purchasing real estate of your own, if you want to put your money to work, there are plenty of ways to do it. When it comes to investing, it’s not a good idea to put all of your eggs in one basket. For well-known investors like Warren Buffet and other experienced investors like Tom Zaccagnino to beginner investors like high schoolers just entering the workforce, diversity is key to getting a greater return and making the most of their investments.

Whether you’re just getting into the investing game or are ready to expand and diversify your portfolio even more, there are certain investments you can make that will give you a greater return than others. As with all investments, there’s inherent risk, and you should always consult your financial advisor with any questions or concerns you may have, but the following investments are some of the best options if you’re looking for something with a great return.

Peer-to-Peer Lending

Peer-to-peer lending is an alternative to a bank loan in which an individual lends money to another person. Generally done online, if you want to invest your money, you can offer loans to others who are seeking funding. Typically, borrows come to peers to get better rates than what is available at the bank, but peer-to-peer lending is still a loan that is paid back with interest. Instead of or in addition to investing in stock and real estate, you may want to consider investing in peers and their ideas as well; peer-to-peer lending is a way that you can do that.

IPOs

Initial public offerings (IPOs) are the sale of the very first stock that a company issues to the public. A company can be in operation for years before they launch an IPO, but before they go public, they are considered private. Shareholders typically only include early investors such as the founder, family members, and friends. Investing in IPOs is easy and can give you a profit in a short amount of time as well as in the long-term.

ICOs

Similar to IPOs, initial coin offerings (ICOs) are the initial chance for the public to get involved in a company. Instead of stock, though, ICOs offer cryptocurrency coins and tokens. Not only does investing in ICOs give you the chance to invest in a company when it first launches publicly, but it gives you the chance to get into the cryptocurrency space as well. Although cryptocurrency has had its ups and downs, it’s becoming more common and is a promising way to invest both now and in the future.

Venture Capitalism

As a venture capitalist, you could provide capital to startups and small companies to help them expand and grow. In exchange for the capital, you will typically be given equity in the company. That means if things go well, you will get a big return on your investment. Additionally, depending on the amount of equity you’re given, you may also have the chance to get involved in the business on an everyday basis which can be a return on investment that you value internally.

REITs

A real estate investment trust (REIT) is a company that pools that investments of multiple people into a group of properties and other real estate. The company then collects all returns on investment, (such as rent), and distributes it back to investors. The trust acts as the middleman between the properties’ tenants and the investors, taking out the hard work but still enabling you to earn a great ROI.

Preferred Stocks

Preferred stocks are like common stock except they provide the holder with a larger claim on a company’s assets and earnings. Although they don’t usually offer voting rights to shareholders, they do pay out a fixed dividend and give priority to the shareholder when the company distributes any assets or dividends. Although they generally require a greater initial investment than common stock, the benefits that you receive when payments come through can well exceed that initial investment and make it more than worth it.

In Conclusion

Whether you’ve recently started investing or have been in the game for a while, diversity is important if you want to make the most of your investments and succeed. Instead of investing only in mutual funds or gold, using your money to invest in other opportunities such as IPOs, venture capitalism, and REITs can help you earn an even bigger return on your investments and get you where you want to go even faster.

What types of investments are you most interested in adding to your portfolio?

 

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