High Yield Investments 101

How does your portfolio look? How were your returns last year? Do you feel like you have bragging rights in front of your friends because you made 12% when they only made 8%? For most serious investors if you are looking at 12% that is good well, lets say decent. At least you didn’t lose money. However, there are investments out there that make 12% look like child's play. It is another ball game. It requires a little more knowledge and work on your part. If you are getting 12% it is probably because your financial advisor had a good year for his clients. I am also willing to bet that your financial advisor has his or her money somewhere else and is making a bigger return than you. Believe it or not 80% of the financial advisors out there DO NOT invest in where they put their clients money. It is because they are willing to put the time and work in to play the game….the game of high yield investments. We will address and give some basics about high yield investments. This is not all of them just some popular ones that are out there today.

Over the past 5 years many people saw this boom and bust in the United States.  All across the country people jumped into the Real Estate market too late and didn’t get out soon enough.  We are now seeing the repercussions of this with foreclosures at an all time high and people scared out of their minds.  Many banks are so backed up on foreclosures they do not even make it out to post a foreclosure notice for over a year.  Believe it or not many people are living rent free for over a year.

A Hedge Fund is an unregulated group of funds that are similar to mutual funds without the regulation.  The risk is much higher than mutual funds however, the rates of return are much, much higher depending on which fund you choose to invest in.  The people that head or manage these funds have the ability to move around assets at a rapid rate and this increases the rate of return and the risk also.  

Investing in emerging markets has also proved to be a high yield investment for investors.  The risk is also higher in emerging markets.  People will put their money into a foreign country or state that they believe is about to emerge or grow.  Many times these countries are less developed and about to go through revitalization.  It is a good investment if you know and understand what you are getting yourself into.  

Note: This is not investment advice, only basic information about some high yield investments.  It is always recommended you the individual investor gets a financial education and properly understand what he or she is getting into before investing any money.  High yield investments can be very risky and very volatile.  There are also many groups that are not prepared or experienced enough to make a profit.