Investing in fund during inflation
Senior economists claim that a recession is inevitable. So, what should we invest in and how do we avoid unnecessary risks?
- A recession is on the horizon: what do we do now?
- Investments outside the capital market
- What is an investment fund?
- Real estate investment funds
- Investing in real estate funds with small amounts of capital
A recession is on the horizon: what do we do now?
News agencies around the world have declared that it is inevitable that the US will enter a recession in the coming year. These predictions come after a series of steps taken in recent months by the US Federal Open Market Committee (FOMC). The FOMC operates on behalf of the Central Bank, the equivalent of the Bank of Israel, which itself determines the interest rates that directly impact bank interest rates.
Inflation (price level) is increasing and markets around the world are being directly affected by this rise. What was considered only recently to be a solid investment yielding a handsome annual return, such as an investment in an index fund (e.g. S&P 500), no longer provides the profits expected by investors and may even have experienced sharp declines. This new economic environment has resulted in significant losses for many.
Investments outside the capital market
Investments outside the capital market are called “alternative investments” and include investments in real estate that generate passive income. Alternative investments are investments that are not directly linked to the volatility of the capital market. Israel, relative to the size of its population, is considered a large investor in alternative investments, bigger than many larger countries. One of the most popular investments
What is an investment fund?
An investment fund is a legal entity that is created to pool the funds of a group of investors. This type of investment provides a wider selection of investment opportunities. Types of investment funds include mutual funds, exchange-traded funds, hedge funds and private funds. The purpose of an investment fund is essentially to bring several companies or indices together and thus reduce the risk of losses should one company or asset suddenly fail. The funds invest in a large number of assets and generate passive income.
Real estate investment funds
When it comes to real estate, investment funds are established to raise the significant sums of money needed to allow them to participate in large and wide-ranging real estate activities. The investors in such funds are called limited partners (LP). They invest in the fund in exchange for shares in the partnership and are entitled to profits in proportion to the shares they own.
LPs enjoy three main advantages:
1. Passive income.
2. Professional management of the fund by the general partner (GP) or the company or the entrepreneur that established the fund.
3. An investment that is spread over several assets, thus reducing risk and increasing yield.
Private real estate funds are investment instruments that large and sophisticated investors enjoy. The funds only welcome investors with substantial amounts of capital at their fingertips, as much as hundreds of thousands of dollars. Does that sound fair? This inequity is why we founded REALTY BUNDLES.
Investing in real estate funds with small amounts of capital
Real estate funds, which we call “Bundles”, are the basis of the REALTY BUNDLES model. We allow investors with almost any amount to invest to join our various real estate funds and benefit from diversification across different types of assets, sometimes even in different countries.
The company communicates with a large number of professional real estate companies and allows the investor to enter into a passive investment without interference, without prior knowledge and with a high degree of transparency through our innovative platform.
Diversifying an investment fund is the best way to reduce risk. We have developed several exit mechanisms that include a planned exit option available upon completion of the Bundle’s projects and an occasional exit option based on the fund’s ability to release investors at different stages.
Are you interested in investing whatever small amounts you may have and building a diverse investment portfolio?
