The importance of diversity in your investment portfolio

Diversification is an approach to investing that involves allocating funds to investments that fall within different investment categories. Your funds may be invested across different industries across different areas of the global economy.

 

Why is diversification important?

The key goal of diversification is to maximise the potential returns of your investment portfolio. The various categories of investment will react in different ways to the same financial event. So by prioritising the diversification of your portfolio, this approach seeks to increase your returns and protect your overall investment portfolio against fluctuations.

As with all investments, there will always be an element of risk, without which your portfolio funds would be unable to grow. However, diversification plays a key role in making the most of your portfolio’s potential for growth in the longer term while protecting your funds from the impacts of any financial events that may occur within the global economy.

How does diversification work?

Some types of risk can be mitigated by the diversification of an investment portfolio, while other types of risk are systemic and cannot be managed through diversification. In some ways, this approach can seem complicated and there are expenses incurred, however, most finance professionals agree that it is a key tool for investors to achieve their investment goals. As with any approach that manages the potential risk to investments, the potential reward is also brought within certain parameters. As with all investment portfolios, decisions must be made by the investor with regards to the amount of risk they are able to tolerate with regards to their financial situation. 

 

The key takeaway

Diversification can play a key role in the management of investment risk and decrease the potential volatility of investment values. As important as this tool is, some systemic types of risk cannot be managed in this way and there will always be some element of investment risk. The goal for your investment portfolio is to achieve a balance between the return you wish to see on your investments and the level of risk you are able to tolerate.

Please get in touch with our team today to discuss more about your portfolio diversification.

 

The Impact of An Accurate Register On Fixed Asset Management

If you have been in the asset management world long enough then you know that if you count all your assets, you’ll always get profit. Regardless, more than 80% of SMEs don’t have an accurate view of all their assets. While large companies hire accountants and auditors to leverage the value of fixed assets, you’ll find that most small and medium-sized businesses choose to do it themselves. 

The problem with this is that they use spreadsheets, and write-offs tend to increase. Despite the fact that most businesses know assets help in income generation, they fail to keep accurate records of those assets. They fail to understand that an accurate asset register could have a significant impact on their revenue.

 

What Is An Asset Register?

An asset register is a list containing all the business fixed assets investments. It details the location, owner/user, and condition of said assets. This register keeps the business up to date with the procurement date, price, status, current value, and depreciation of the assets. 

Types of Fixed Asset Registers

Small businesses could use just one register, known as a fixed asset register, since they may not own many assets. Medium and large companies, however, could have specified registers to narrow down the lists and make tracking manageable. For instance, they could have an IT register or a digital asset register.

 

The Best Way to Keep the Register Accurate

Accurate records of your fixed asset investments are highly important. Export all the records available on your asset management software then have a physical audit to see whether the list matches. If there happens to be a difference, then you have ghost assets, which you can write off. 

If you have unusable assets, have them repaired or write them off if that’s not an option. If you have multiple assets, it may be hard to keep track, especially if they move across different locations. Have them tagged with a barcode or RFID label to make tracking easier. You can also carry out a physical audit at least once or twice a year depending on the number 

 

4 simple ways to make a lucrative real estate investment

Real estate has long been considered one of the safest and close to assurance on return on investment. Let’s face it; more and more people are being born, more businesses and companies are growing, providing a steady and growing market. What makes real estate a more exciting investment strategy is that unlike bonds and stocks, investors may use their investment as leverage to acquire or purchase another property. If you are unsure of how to make a real estate investment, these four tips should help you to make wise decisions.

 

  1. Be a landlord

Being a landlord is best suited for investors with renovation, DIY skills, and the patience required to cope up with tenants. However, the initial capital required is usually high for finance maintenance costs and to make up for vacant months. On the positive side, rental investment provides a regular stream of income and can also be used to maximise capital gains through leverage. For maximum profit on a rental property, landlords opt to hire property management companies as tenants can at times be rowdy and damage property.

  1. Join a real estate investment group 

For investors who wish to join real estate without necessarily facing the hassle of running it, real estate investment groups are the place to be. All an investor requires to enter a real estate group is access to financing and capital cushion. The advantage of such a group is that it provides a more hands-off investment approach that still yields appreciation and income.

  1. Flipping

Flipping is a form of investment that includes real estate trading. It is more suitable for investors who are well versed in marketing and real estate assessment. All a prospective investor requires is the skills to oversee repairs and capital to invest. Additionally, the time frame in tying up money and effort is usually short. Flipping can, therefore, realise high returns even within a shorter period depending on the market conditions.

 

  1. Real Estate Investment Trusts (REITs)

REITs are suitable for investors who wish to venture into real estate without a traditional real estate transaction by using portfolio exposure. All a prospective investor requires is investment capital. As REITs are essentially dividend-paying stocks, investors get to earn money through cash producing leases. However, this means that leverage, in this case, does not apply.

Deciding on a suitable type of real estate investment inevitably depends on a number of factors, so it is essential that you are able to make an informed decision.

 

Future Fuels

Established in early 2016, FutureFuel Holdings Ltd and its subsidiaries are a UK-based Group in the renewable energy sector (“FutureFuel”) with a strong passion to help create a better tomorrow for future generations by improving the way in which energy is generated and the planet’s resources utilised.

Key Features:
Fixed Term Bond, maturing on 14th September 2022
9% return per annum
FCA regulated bond administrator
We have a 4.9 / 5 rating from our existing Bondholders; please view our reviews here
Play a vital part to help generate a clean, renewable energy source for the UK
After phase 1 was successfully completed, we at FutureFuel are now offering our second Bond issue to fund the development of two additional processing facilities in Kent.

Platinum

Platinum Assets & Developments Ltd (PAD) is a successful privately owned business. It operates in a variety of developmental sectors including Private Rental Sector schemes, traditional development, renewable energy farms and student accommodation schemes.

Highly experienced Team
Asset Backed
Low entry level £10,000
Regulated Security Trustee in place to act in and protect the interests of Bond holders
Access Bonds are secured by a fixed first charge over the Company’s rights in respect of loans and the related security for those acquired loans
2-7 year time frame
12% Gross Return Per Annum – Plus bonus payments if the interest is retained.
This represents a secure opportunity to diversify and is open to institutional and professional investor funds

Access

Access Commercial Investors 4 Plc is offering subscription of up to £7,000,000 secured 8.1% bonds due 31st December 2022 with a minimum investment of £2,500 per investor. Coupon payments are made twice a year on the 30th June and 31st December each year

Asset Backed and listed Bond offering
Low entry level £10,000.00
Regulated Security Trustee in place to act in and protect the interests of Bond holders
Access Bonds are secured by a fixed first charge over the Company’s rights in respect of loans and the related security for those acquired loans
Bonds are transferable (dependent on market conditions)
8.1% Gross Return Per Annum – paid every 6 months
Fixed non correlated income opportunity with no effect from the markets or Brexit
Matures on 31st December 2022
Interest payments made twice a year
ISA Compatible (UK Clients)
Make additional Monthly Contributions
Uncapped existing ISA Transfers – whole or part transfers welcome
This represents a secure opportunity to diversify and is open to institutional and professional investor funds

iWater Group

IWS is a UK manufacturer and supplier of unique water treatment and antibacterial products, services and solutions for sectors requiring high water quality.

Highly experienced board of directors

IWS now has its products fully tested, protected, proven, and approved.Cash flow positive and profitable.
IWS is one of the most certified, generally approved and proven chlorine dioxide companies in the field of water treatment.
IWS has received the DWI’s highest possible approval for its products following testing and inspection in the UK.
IWS products are considered as extremely safe and absolutely harmless in the treatment and use of drinking water for humans and animals.
IWS has multiple national and international certificates and approvals for its products. ECHA, Defra Approved, CEFAS, DWI, NSF, SOIL ASSOCIATION ORGANIC, SCOTTISH GOVERNMENT.
Minimum subscription £5,000
Environmentally Friendly.

How to strengthen your investment portfolio

Building and maintaining the strength of your investment portfolio may prove to be a daunting task if you are not well acquainted with a few secrets of investing. While some of the below tips may sound overly basic for you, ignoring them has led to the downfall of many investments. If you steadfastly implement the concepts, then your investments are more likely to be successful. Here are some secrets to strengthening your investments portfolio:

Lay out clear objectives: Any investment portfolio requires clearly defined objectives, which will provide the owner with valuable insight on what to expect as returns from the invested money. A portfolio that lacks clear objectives is like a rudderless ship in deep waters with no sense of direction and purpose.

Keep your costs at a minimum: Every amount of money, however small it may seem counts in the long run. Do not give up any money without taking the time to consider if the decision benefits your investment. Any successful investor should be aware of the basic requirements in making a successful investment journey. Managing costs is a critical aspect of this journey. Therefore, avoid spending money in the form of any fees if it is likely to cause unrecoverable losses.

Expand your investments: Why should you keep all your money in a single investment when there are plenty of opportunities to venture in successfully? For your portfolio to be stronger, it should be diverse and able to stand the test of tough economic times. The underperformance or bankruptcy of one investment should cause a minimal ripple effect on the overall operation of your portfolio due to the spreading of risks.

Minimize your investment turnover: Many poorly performing investments have also been associated with unhealthy high turnovers. Low turnover might be what your investment portfolio needs to become strong. Always keep in mind that the market for short-term stocks can be insanely unpredictable, and volatile. Therefore, investing in new shares should be well thought and understood.

Becoming an incredibly successful investor will require you to apply these secrets even as you improve your skills and constantly adapt to the needs of your sector. Strong investment portfolios you see today were not built in a single day. It takes effort, patience, and trials to achieve such status. Always be ready to learn the dynamics of the financial world and your sector even as you aim at strengthening your investment portfolio.