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Question About US Residential Asset Fund

Laura asks…

I’ve got 5 million US dollars, wanna to invest in Austrilia, what project should I invest?

I’ve got 5 million US dollars, want to invest in Australia. But not in shipping again because I’ve already got shippings, only 1.4 million with cash. What project should be a smart choice?

Best Answer:

If you have 5 Million US dollars, you should be more open to opportunities outside of Australia (As you have so wisely chosen to diversify out of shipping) but the answer to your question depends heavily on two things #1) your risk tolerance. #2) you’re short vs. Long term financial needs and objectives. Before I give you some specific options, consider a few rules of thumb: Only invest in things pertaining to your sphere of competency (where you feel most comfortable and knowledgeable of the industry, service, or project being presented) and with managers you TRUST. Also, only ‘risk’ money you can afford to lose. If you mind these things, you will sleep better at night after you’ve made an investment decision!! So here’s your answer:

All investments can be placed into three categories: INCOME, GROWTH and VALUE. Keep this in mind when viewing projects. But I shall give an example portfolio allocation that would produce nice returns with very little overall risk:

If you have 5MM USD and this is most of your net-worth, you be wise to invest 60 % of your funds in Low- risk investments (I.e. Money Market Funds, Municipal Bonds, T Bills, Life Settlements ) 30% in Moderate risk investments (i.e. Commercial/residential real estate: NNN Leases, pre-construction, RE secured Trust Deeds, Mutual Funds, ETFs) and 10% in high risk investments ( Alternative investments including ( managed Futures, Forex, Commodities accounts) Business LPs, ect. )

(If you haven’t already done so) Use either a percentage of your investment capital or the returns thereof to invest in an adequate estate plan (insurance, wills, trusts, insurance) to protect your assets. You’ll be sorry if you ignore this!! I could go into more detail, but this is a good start. If you want some SPECIFICS, contact me… Id love to share.

Hypothetical returns: Low risk 5% return on 60% of your portfolio, Moderate risk 10% return on 30% of your portfolio , High Risk 80% return on 10% of your portfolio : ( .03+.03+.08 ) = you would have growth of 14% ( $700,000) in the first year with this very low risked allocation. This figure could be adjusted depending on your personal tastes.

Now, how much work did you do to make this $700,000? Just make sure you re-invest the earnings ( the portion you decided not spend anyways )

Posted From Yahoo! Answers (for informational purposes only)

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