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Battered by an economic downturn over several years, investors like their counterparts in the European Union and the United States, looking for investments that maximise asset growth.

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Risks of Real Assets as an

Investment - Daniel Kalenov

All investments, including property funds and other real

assets, carry risk.

Following years of poor performance by market-traded securities, investors are

choosing real assets as an alternative. But all investments are subject to risk.

Battered by an economic downturn over several years, investors like their

counterparts in the European Union and the United States, looking for investments

that maximise asset growth. Traditional market-traded securities (stocks and bonds)

in particular have underperformed, leading investors to look at alternative


Alternative investments range from the opaque (short only funds, ultra short funds,

absolute return funds, market neutral funds, hedge funds) to the transparent, such as

real estate investment trusts (REITs), private equity and venture capital. A subset of

alternative funds includes real assets, including land, developed real estate, rarities

(art, antiques, stamps, fine wine, coins, antique cars), precious metals (gold, silver,

platinum, palladium) commodities (energy sector fossil fuels, plus agricultural goods

such as wheat and corn) and even renewable energy products (biofuel crops, solar

panels and wind turbines).

This last category, real assets, holds great interest after the disappointments of exotic

and complicated investments such as derivative assets. Art can be appreciated with

the eyes, much like antiques. Fine wine can be held, traded or even consumed (a

reckless investment act, but sometimes a celebratory gesture of something of even

greater significance). Land can be traversed, formed, beautified and turned into

human habitat. Precious metals are sometimes adornment, or held in bulk in safety

vaults. We feel good when we invest in energy to power industry, perhaps even more

so when it is from renewable and non-polluting sources. An antique car might be

driven for very special occasions - carefully and responsibly.

But real assets such as these carry their own risks. While insurable, rarities such as

art and antiques can be utterly eliminated by fire, natural disaster or theft.

Commodities are subject to market forces that can, under some circumstances, cut

value to a net loss.

Land investment and land development are also subject to external forces. But

professional advisors control variables in strategic land investments with methods

that include the following:

1. Choose land that will likely appreciate -Experienced land investors

(many investors join small-group funds with professional advisors) search for

property that is ripe for development (usually for housing) to accommodate growing

population. Such properties are typically slated to become part of a town plan. The

investors - who at a minimum invest 10,000 - do not blithely wait for the planning

process to play out but actively ensure their land investment progresses on a timely


2. Infrastructure investment (where appropriate) -Some land

investments benefit from the building of roads, the installation of utilities and water

and sewage removal. This makes the property ready to build for construction firms.

3. Expertly time the land sale -All strategic land development follows a

pre-set timeline. This is important to the investor, as he or she can know when to

expect a distribution on the eventual sale profit.

Still, even well managed property funds investments come with unknown variables.

Would-be investors who want to learn more about strategic land should consult with

Daniel Kalenov an independent and qualified personal financial advisor.

And learn about real asset investing, retirement security, offshore diversification,

and many other topics. Daniel Kalenov Global Diversified Partners help people take

control of their financial well being by educating them on the benefits of investing in

tangible assets and by altering their perception of what “smart investing” means

To know more, please visit: