Building an investment portfolio is something I am asked about all the time.
So today I want to give you some options to have a look at when it comes to building your portfolio.
Whether you’re a new or experienced investor, putting all of your eggs in one basket is never the wisest strategy. You’ve heard me say that many times before.
As you know, a bad turn of events in one asset class could potentially leave your financial future in ruins if that is your only investment.
Frankly, the developments of the last year due to the pandemic have shown that in stark clarity.
However, diversification shouldn’t cost you the dream of securing the best financial future. In fact, it should support your strategy.
Choosing the right assets is vital and outlined below are five options that you should review to determine if they are suitable for your investment portfolio.
Please note that these are not personal recommendations. Instead they are investment portfolio options that you can consider. As you know, I have not been a fan of cryptocurrencies, but that doesn’t mean you shouldn’t consider them.
So let’s take a look at five options that you have for your investment portfolio, some of which are not the usual options that you will here from me…
The idea that you’ll never lose money on property may be a stretch, but it remains one of the most reliable and steady investments you can make. And as a point of transparency, real estate investing is where I have made the majority of my wealth, so I am a little biased toward property.
There are many options when it comes to real estate investing. I have previously outlined all of them here.
One of the more popular now is house and land packages in new estates or developments. People have been doing quite well with these packages with quick short term equity gains which can be used for adding to your investment portfolio.
With the right house and land packages, your property portfolio will open up opportunities for a quick sale or ongoing revenue as a landlord. Most new real estate investors opt for local assets with a view to entering other markets at a later date.
However, with the right team on your side, there is enough flexibility to target the property types and locations that appeal most to you.
As you may have heard, Bitcoin is on fire since the start of the year. It is once again breaking new highs. One of the things that I teach to my Investing Bootcamp students is that all-time highs are a good time to be investing as there are no sellers, everyone is making a profit. This can lead to rapid moves up as those suffering FOMO pile in and drive the price even higher more quickly.
So that is worth considering when looking at cryptocurrencies in your investment portfolio.
Cryptocurrency has been the hot talking point for around a decade now, and it shows no sign of going away anytime soon. While the rise of Bitcoin has grabbed the headlines, plenty of altcoins offer alternative opportunities.
One of the great things about this market is you can hold many coins. Moreover, with an educated investment, it’s possible that a few hundred dollars could become tens of thousands within a few years. Volatility does create risk, but that’s what makes it so exciting. If that is what you are into.
My recommendation would be to start considering whether cryptocurrencies should be a small part of your investment portfolio, as it seems they are not going away, and the returns have been impressive to say the least.
The caution is, they also come with massive volatility, just sayin’.
Backing Small Business in your Investment Portfolio
It has been a difficult time for the economy, but that doesn’t mean businesses aren’t thriving.
Plenty of startups and SMEs are grabbing hold of the unique opportunity. Leveraging success from tech and customer experiences.
Backing new companies that you think have potential, or financing the expansion of an existing SME can be very rewarding. Aside from the financial elements, there is the satisfaction of helping entrepreneurs.
In some cases, the products or services in question could change the world – as well as your finances – too.
This is a specialised investment that requires a lot of advice from lawyers and accountants to ensure you are entering the investment with the appropriate structures and protections.
Having said that, with everything that is impacting small business in the world right now, there are going to be a number of small business that need cash to continue and get back to ‘normal’.
This could be a great time to get some equity in an upcoming small business with reasonably small investments. Keep an eye out for businesses that you like or know that may be looking for some new equity investors to help them rebound or even thrive.
The alternative to direct investments like these are simply finding the stocks that will rebound strongly as the economy returns to normal. There are going to be a number of businesses that struggle, which also means there will be others that thrive. Your investment portfolio could benefit from a few small investments into stocks that you believe are well positioned to recover quickly.
Backing Your Own Venture
If you’re not prepared to pump hard-earned money into another entrepreneur, why not back yourself.
This is a great time to start a side hustle, not least because recreational activities are limited.
If starting a retail, manufacturing, or consultancy firm doesn’t appeal, there are many online options. Content creation and social media influencing are just two of the best options at your disposal.
When this type of investment works, you will have the chance to withdraw money in the short-term future. You’ll also build towards long-term rewards.
This is another option that I have pursued and really enjoy. If you are interested in getting started with a side hustle that works and is already proven, take a look at my free ebook here that explains it all, and the free training on how you can start your own side hustle that could become your full time gig.
This is not an investment that I have much experience with. However, in the spirit of completeness, I wanted to add it to the list for your consideration.
In addition to the many solo options at your disposal, there’s the chance to run joint investments.
This allows you to access joint ventures that would traditionally fall outside of your budget.
In addition to leveraging success through joint wealth, it allows you to combine the knowledge. In turn, this will give you a far better shot at spotting potential flaws in the investment plans. While they may not be ideal on their own as you don’t always have full control, they are a great way to support personal endeavours. Not least when entering new arenas.
Conclusion – Investment Portfolio Options
So there are five options for you to consider for your investment portfolio.
The great thing about growing your wealth and investing is that there are always options. The thing that I always say and teach is to manage your risk. Everybody has different risk profiles, so what might be right for one person won’t be for another, and that is ok.
As long as you understand what you are looking to invest in, and can manage the risk profile of the investment, or the risk profile that it adds to your total investment portfolio, then you are good to go.
Remember, we are long term investors, looking to grow our wealth for our retirement. As such, that means we don’t chase quick wins, although we will take them if they are available, but our goal is quality assets over the long term.
Let me know what you think in the comments below.