What are Assets? List of Top Assets Madhurima Tiwari

What are Assets? List of Top Assets

@Madhurima Tiwari

An asset is anything of value or a resource of value that can be converted into cash. Individuals, companies, and governments own assets. For a company, an asset might generate revenue, or a company might benefit in some way from owning or using the asset.

1. Real Estate Crowdfunding 

It might come as little surprise, but numerous types of real estate investments appeal to many people for multiple reasons:

the tangible nature of the investment

low-correlation with the stock market

multiple return components (assets that appreciate in value and also yield rental income)

tax advantages.

However, the hands-on factor of owning, renovating and maintaining your property as well as acting as a landlord deters many people from getting started. 

2. FundRise → Investing in Real Estate Portfolios 

Minimum Investment to Start: $10

Type of Real Estate Investment: Commercial and Residential Real Estate

Type of Investor: All Investors

FundRise differs from the two companies above by choosing to focus on investments in real estate portfolios, or several properties in one investment.  In theory, this diversifies your investment risk while providing you access to several properties simultaneously.

To date, the most popular real estate investment platform offering a portfolio approach is Fundrise. This investment platform provides several options for you to review and invest your money.  Their available portfolio options include:

The Starter Portfolio – This option allows investors to start investing in real estate with as little as $10.

Core Portfolios (Supplemental, Balanced, and Long-Term Growth) – Each of these “Core Portfolios” comes with a higher minimum investment of $1,000 and targets a different investment objective.  Supplemental aims to provide additional passive income from real estate investing on the Fundrise platform, Long-Term Growth invests money for the primary goal of capital appreciation, while Balanced focuses on both of these investment objectives. By offering these investment portfolio options, investors can choose which investment objective best aligns with their financial goals. 

3. Certificates of Deposit (CIT Bank)

Certificates of Deposit (CDs) are offered by most banks and credit unions and are easy to open and understand. CDs are almost risk-free and insured in the United States for up to $250,000.

They are another savings instrument like savings accounts but come with longer-term commitments, varying from three months to five years.

They work by having you lend money to a bank for a set amount of time (the “term length”), with longer term lengths typically involving higher interest rates.

Much like any interest-bearing asset, the longer the term length or commitment, the higher interest rate and return you can expect to earn in exchange for losing access to your money for longer. 

4. Money market accounts 

Money market accounts are similar to online high-yield savings accounts, meaning that they earn interest and are FDIC insured.

This covers them with the obligatory $250,000 in insurance against assets held in the account in the event the depository institution fails.

Despite not carrying additional risk, they tend to pay more than a traditional savings account.

Different than CDs, which can charge penalties for early withdrawals, you can close a money market account at any time.

Further, you usually also carry the ability to withdraw money from the money market account each month through a checkbook or with a debit card. 

5. Alternative Investments (Yieldstreet) 

Minimum Investment to Start: $500

Type of Investor: All Investors

Alternative investments have become increasingly popular as fintech services open up once closed markets to the individual retail investor. These opportunities have democratized numerous markets and unlocked previously-inaccessible cash flows to pad your income from assets.

Yieldstreet is one such platform leading the charge to provide access to income generating assets in a number of asset classes.

Yieldstreet is an alternative investment platform that provides you with income-generating opportunities. These investment opportunities come backed by collateral, typically have low stock market correlation and span across various asset classes. Such asset classes include:

art finance

real estate

commercial finance

legal finance and more. 

6. Secured Peer-to-Peer Lending (MyConstant) 

Minimum Investment to Start: $10

Type of Investor: All Investors

Another income-generating investment option, MyConstant, offers P2P lending, though in a different flavor than some other P2P lenders in the space.  This service differs by serving as an alternative investment platform and offers only secured peer-to-peer loans.

This means that MyConstant requires collateral- specifically cryptocurrency- to back all loans made on their platform.  Because these loans come backed by collateral, they represent a lower risk than a non-secured P2P loan, all things being equal.

What I want to state unequivocally, however, is that MyConstant is not a federally-insured savings vehicle like some of the options mentioned in this article. Rather, MyConstant is an alternative investment platform which offers interested investors attractive risk-adjusted returns. 

7. Living Off Dividend Stocks 

Dividend-paying stocks are a great way to receive consistent earnings throughout the year.

Usually, these stocks are from more mature and established companies who are able to part with their cash flow more easily.

This occurs because there are fewer opportunities to invest and grow the company and the best manner to use these funds would be to return the cash to shareholders.

No two companies are the same and therefore the percentage rate for your dividends (dividend yield) varies by company.

Quality companies which have consistent earnings and pay shareholders dividends regularly are commonly referred to as “blue-chip stocks.”

They tend to carry less risk than growth companies, all things being equal. 

8. Bonds and Bond Index Funds 

Stocks and bonds are talked about together as often as macaroni and cheese. Bonds are essentially a loan you give to the government or a corporation.

These are very stable (as compared to stocks) and you’ll know exactly how much money to expect back when you invest in a bond.

Longer-term bonds tend to carry higher interest rates as a means for compensating you for holding their debt longer.

However, you can choose to invest in bonds of different terms based upon your personal investing objectives and goals.

You might prefer some shorter-duration cash flowing assets and therefore opt for shorter-term bonds set to mature in the coming few years. 

9. Real Estate Investment Trusts (Streitwise) 

Minimum Investment to Start: ~$5,000

Type of Investor: All Investors

Some people consider Real Estate Investment Trusts (REITs) to be the mutual funds of real estate. REITs are a collection of properties operated by a company that uses money investors give them to buy and develop real estate.

You can choose to invest in trusts that build condos, apartment buildings, business complexes, or other facilities.

REITs pay you dividends. These are a fitting income-producing asset for people who want an easy way to get involved with real estate investing without having to purchase property themselves.

One avenue to explore for investing in REITs is by investing through Streitwise. 

10. Private Credit Investments (Percent) 

Minimum Investment to Start: $500

Type of Investor: Accredited Investors Only

Percent is an investment opportunity for accredited investors interested in accessing private credit (non-bank lending).

Percent has built a way for retail accredited investors to access a wide range of private credit opportunities with a clear view into their performance through its innovative tools and comprehensive market data.

Investors can make better-informed decisions, source and compare opportunities, and monitor performance with ease, all on the Percent network.

Additionally, investors have attraction for the alternative investment platform’s shorter term, higher yielding, and uncorrelated returns to other asset classes. 

Madhurima Tiwari

MBA Finance

FinTech Manager

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