While debates are still ongoing about whether or not we are currently in a recession, there’s no doubt that now is the time to be re-evaluating your portfolio in light of the economic landscape.
You may feel tempted to stop investing in new deals altogether until things feel more certain, but the wise investor can find valuable opportunities regardless of what is happening in the economy.
In particular, there are certain strategies you can use to mitigate your portfolio’s risk for the months ahead. And with Avestor’s customizable fund model, those strategies are more attainable than ever. Keep reading to learn about the top 3 ways you can reduce your risk while investing in a customizable fund.
1. Diversify Your Portfolio With Fractionalized Investments
You probably understand inherently that diversifying your portfolio can reduce your risk. But too often in the real estate syndication space, high investment minimums make it difficult for investors to diversify.
This is one of the key features of a customizable fund. When you invest on the Avestor platform, every deal is fractionalized, allowing you to invest smaller amounts in multiple deals. As a result, you have the option to diversify your portfolio across different markets, asset classes, investment strategies, and time horizons.
For example, if you have already invested in a variety of multifamily real estate deals, you may want to diversify with commercial asset types that tend to remain stable throughout periods of recession. Or if most of your investments are concentrated in one region of the country or market typology, you can intentionally seek out deals in a different market.
And since you’ll share ownership with other investors — just as you would in a syndication deal — you’re only taking on part of the downside risk instead of the full risk of owning a property on your own.
2. Control Your Capital Allocation With a Customizable Fund
A customizable fund is not the only model that allows you to diversify across multiple deals, but it is the only model that does so while also giving you full control over each of your investments.
Unlike a REIT or other real estate fund, Avestor allows you to choose which deals you participate in and how much capital you allocate to each. With this level of control, you can experience the peace of mind that comes with knowing exactly where your capital is being used and how those investments are performing.
You also have the ability to add additional capital to the fund at any time, whether it’s because you’re feeling more confident in the market or you’ve found an exciting new deal you want to participate in.
3. Monitor Your Investments With Full Transparency
Our team at Avestor is committed to operating with as much transparency as possible, from the information we provide within our product to the fund managers we choose to work with.
We’ve built the Avestor platform to make it as easy as possible for you to accomplish 3 things:
- Conduct due diligence before making an investment
- Check in on the performance of your investments whenever you choose
- See the final performance data for every completed deal
This transparency is another way Avestor differs from REITs and other traditional funds. Not only can you choose where you invest, but you can see how those investments are performing any time you log into the platform, not just when you receive distributions or get an update from the sponsor.
If you’re interested in learning more about our current investment opportunities, please click here to learn about the funds on our platform.