Given the turmoil in mainstream markets, now is the time to move your investments to Peer-to-Peer Lending
27th August 2015
Recently we've seen complete chaos in global stock markets caused by the Chinese slowdown, subsequently, investors are moving their money. This is the perfect time for investors to embrace a more grass roots type of investing where comparative yields can be achieved in addition to entering what we believe is a more predictable and stable market.
Economically, moving funds into the alternative investments sector supports the overall economy. This is because these investments increase GDP and job creation that ultimately bolsters more mainstream markets in the longer term. This is why a part of every investor’s portfolio should be in Peer-to-Peer, where interest rates of 6%-15% APR can be achieved, before bad debts (currently 0% on Crowd2Fund) and tax.
As the alternative finance sector matures and evolves, marketplaces are emerging where investments can be bought and sold to other investors. The ability to introduce a new marketplace trading peer-to-peer investments on this level is not only very interesting but also more feasible due to the mass adoption of technology by mainstream audiences.
This allows investors the opportunity to exit investments, operating in the same way as the stock market but with significantly lower cap businesses and, of course, predominantly debt-based investments where the historic performance of an investment can be clearly understood – i.e. the business has consistently been making its repayments..
Another advantage of investing in Peer-to-Peer over the stock market is that debt-based lending is much more predictable than investing in equities, whilst being simpler and clearer to understand. It’s much easier to assess if a business can afford a loan rather than forecasting the share price of Apple Inc. where specialists skills are generally required to assess the mass of qualitative and quantitative company information – and is not predominantly based on ‘investor confidence’.
The beauty of Peer-to-Peer lending, is that you can become more involved with the businesses if you wish, whether it's receiving a reward or perk for investing, or following the business as it grows.
So there we have it – make simple investments on Peer-to-Peer and potentially achieve the same returns, if not better, than mainstream markets whilst supporting the economy and not exposing yourself to the highly volatile stock markets.
Remember though, all investments entail an element of risk and because there is always risk, you could lose your capital.
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