Educate your clients on options not correlated
with traditional market risks.
What are Alternative Investments?
Alternative investments are the asset classes that are different than conventional investment types, such as stocks, bonds and mutual funds. They are sometimes referred as structured products with short to medium term time horizons, typically 9 to 60 months. Often times they are designed as private placements and available for purchase to “qualified” or “accredited” investors only. They offer attractive yields, averaging 8% to 15% per year with strong collateral in place.
Samples of Alternative Investments
Fractional Life Settlement
Participate in a fund that purchases a package of discounted life insurance policies from holders that want to cash out their policies early. The estimated lifespan of this investment is 24-48 months, with an average annual yield of 11%.
Participate in a fund that privately lends money to energy companies. The loan is in a first lien position (UCC-3 assignment), which means significantly reduced risk. The loan term is 9-24 months, with returns of 7.5% to 9%. Interest is paid to investors on a monthly basis. Return of principal is available upon request at the end of the term.
Merchant Cash Flow
Provide a source of working capital to small businesses and entrepreneurs to fund short-term projects and investments. The investor recoups principal and interest via daily ACH repayment. The estimated term is 9 months with an average return of 7% - 12%.
Disclaimer: These average returns are in no way guarantees of future performance. These rates are not guaranteed unless explicitly noted. The higher average rates of return are assumed with a higher risk factor than standard CD's and bonds, which are backed by the federal government. SEC regulations require that potential investors be affluent, meaning they have an income of $200,000 or more, or have a net worth of over $1,000,000 (not including home equity).
Current Risk Score
Let's consider the Smiths.
A husband and wife with two children, $2 million in qualified and non-qualified assets, and wish to retire in 10 years. Their main financial goals include reliable income, contributing to their retirement, and wealth accumulation.
A risk assessment determined that the Smiths' ideal portfolio would have a Risk Score of 25, which means that they are willing to risk 3% of their assets ($28,664) to have a chance at a 5% gain ($53,665) over the next six months.
Based on their current asset allocation, the Smiths' portfolio has a current Risk Score of 72 (seen to the left). But by distributing 40% of their assets into Alternative Investment options, we're able to decrease their Risk Score to 33 (seen to the right).
The use of Alternative Investments allowed the Smiths not only decrease their Risk Scores by 39 points across the board, but also succeeded in getting them much closer to their ideal financial situation.
Proposed Risk Score
Meet Aleksander Dyo
He’s an expert in alternative investments and business consulting.
Get to know us
Together, Aleks and Kelly co-founded and operate Profectus Financial with the common goal of helping people grow their wealth and accelerate their success. Their industry-leading work in Alternative Investments and other strategies has earned them MDRT Top of the Table memberships for years running, as well as features in industry publications like Forbes and MDRT Magazine.
Meet Kelly Woo
She was featured in MDRT Magazine for her outstanding performance in the field.
Want to bring your clients options with balanced returns?
Reach out to us for additional information and ask us any questions you might have. We'll show you how to leverage Alternative Investments with your clients' portfolios to boost returns and strengthen your reputation as holistic accountant.
Claim Your Spot
Join us on Thursday, December 14th at 1pm PST for a dynamic webinar on Alternative Investments, hosted by our co-founder, Aleksander Dyo.
Can't Make It?
No problem. Simply fill out the form below to request a one-on-one call with our co-founder at a time that works for you.
General Disclaimer: We recommend that Alternative Investments be used to supplement your portfolio, not be the sole investment. Alternative Investments generate higher average returns, but do assume a higher risk factor. Suitable investors must understand that there is a degree of risk, including the possible total loss of principal.