Last Updated on Dec 20, 2019 by James W
Managing your assets is challenging enough, so when it comes to settling on a plan for how to best grow your investment portfolio it’s natural to feel a little overwhelmed. There are countless options and conflicting advice you’re going to come across. Don’t let yourself be swayed by emotional factors and tips from friends. Always do your research and due diligence. To start you off, here are five investment ideas to expand your portfolio:
1. Commercial Property
Many people will put a lot of time and effort into choosing their real estate investments, as they should. A common point missed in the research stage, however, is looking seriously into available commercial property for sale. Many, particularly early investors settle for residential deals on the assumption that they are easier and less risky to manage. While the risk factors may be higher on average in commercial, so are the rewards.
The benefits of commercial property investment include a lot less maintenance on your behalf as commercial tenants cover most outgoing costs, high net profits per annum, significant depreciation and tax benefits and enjoying the stability of long-term corporate tenants.
2. A Diverse Stock Portfolio
You do not want to put all your eggs in one basket, nor count them until they’ve hatched! These apply heavily to stock trading as there will always be a level of risk involved. While you can’t avoid losses entirely, you can certainly balance your risk by ensuring you keep a diverse portfolio – especially if you plan to hold on certain stocks long-term.
Some ways you can spread your equity is by investing in different securities i.e stocks, bonds, Exchange Traded Funds (ETFs) or Index Funds. You can also diversify by industry sector and markets in different geographic locations. As time goes on, review and repeat this process.
Similar to commercial property, many people overlook art as a realistic investment option because of presumptions that it is unattainable or too difficult. In reality, it’s not as difficult or uncommon as you may think, especially if you already have some knowledge of art or a creative background.
What makes art unique is that it is a tangible asset class that bears no correlation to stock markets; it will still retain value even when the markets fail. The challenge is in locating, selecting and ensuring authenticity of the art you acquire, so maintaining your patience and being extremely thorough in your research is vital.
4. Gold and Silver
All the feedback you’ll hear regarding gold is likely to fall into two categories: those who preach our oldest form of currency as the only truly valuable asset class, and; those who renounce it altogether. Do not feel pressured in joining either camp. The reasonable middle ground is acknowledging it as a valid investment choice to potentially include in your portfolio.
The most divisive opinion in today’s investment world is undoubtedly Crypto. Whether you grow to love it or hate it, this recent innovation and highly contested digital asset is here to stay. Blockchain; the technology behind cryptocurrency is growing in popularity for numerous applications. If you can wrap your head around the concept, you may want to consider crypto as an option.
This is just an introduction to a few ideas. The next step is to do further research to determine which options are most suitable for you. The bottom line for any investment choice is that you should understand where you’re putting your money so that you can make informed judgements on how to manage, change and grow your portfolio.