If you had $1 million of personal savings, how would you invest it? Would you use a wealth manager, split it among several mutual funds, buy individual stocks, etc...
You can read a detailed thread on this topic on WSO.
Trending Content - Off Topic Forum
Career Resources
I would invest it in Real Estate in Emerging Markets. One of my dad's most successful investments was buying $70,000 worth of land back in 1999. He still owns it, and it's worth $4.3 MM as of 2012. The crazy thing is it's not a bubble, but rather sustainable growth due to an increase in birth rate/ living standards/ population. I predict this growth to continue spiraling upwards until about 2030, and tapering off thereafter.
Do you mind sharing which country your dad bought that property in?
Sri Lanka/ Bhutan. It is his, and therefore my country of origin. I don't want to name the country outright, because very, very few people from my country go into finance (most pursue academia/ STEM), and I don't want to out myself. That being said, it hardly matters which country it is, since most EMs react in similar ways.
I agree with the above for the most part. I made my first real estate purchase of a building in Brooklyn and it is a cash cow. I would not, however, invest in buying personal real estate here in NYC.
I would suggest an index fund, some currencies, muni bonds and a few individual stocks like AAPL, GOOG and others.
I would split it between two or three managers, and keep 50k to trade with personally.
I know it's trite at this point but AAPL will explode this year. Just a thought.
@ Leonidas - Where and what type of real estate would you purchase now?
Agree about AAPL - I bought in around $380 right before Jobs died. Don't think it's worth adding more at $500 though.
Personally, I invested $20,000 of my last bonus into buying an expanse of land in an up-and-coming neighborhood in Sri Lanka/ Bhutan. I invest primarily in flatland, since it saves me the hassle of worrying about if some punk vandalized it. I also try to go for under-developed areas, which are just on the cusp of becoming industrialized (i.e. roads and railways are being built near it). IMO buying RE in the capital city which is already developed is a waste, since the price is already over-inflated, and will fall once other parts of the country gets better infrastructure.
My investing strategy is very simple. I hold assets for 5/10 year periods, and sell it as is for over 20/50 times the amount I originally bought it for. The downside is that I can't rent it out, so in the intervening years, I get nothing. Furthermore, this is an extremely illiquid asset class, and takes 1-3 years to sell it at the market price.
Sri Lanka and Bhutan, wtf?!
Cocaine, jet skis, and Air Jordans.
Diversify throughout asset classes, managers, securities and countries... also diversity in terms of the firms/banks you use to hold these assets.
Further notes: - Low cost index funds for equities (diversify globally). - Low cost bonds & bond funds (diversify globally, corporate, governments, investment grade and other) - Small amounts in commodities, gold, etc... (useful in reducing risk in a portfolio) - Cash is an asset class you should be invested in... it helps you take advantage of opportunities, but more importantly it means you don't need to liquidate your other assets in order to meet sudden life costs or entrepreneurial ventures you may want to take advantage of. - Pay off your debts (credit cards, personal loans, any recourse debt, etc...)
No need to manage this actively... just diversify and live your life. Do you want investing to be your second job?
Alternative approach (if you're into active management): - Hold most of your funds 70-80% in cash (held in several banks/firms) - Invest the rest opportunistically.
The benefit of either approach is that they are scalable and it is very unlikely that you will end up with nothing/losing your life saving no matter what happens to the world/financial markets... great recession 3.0... global war... civil strife in your country... you lose your job... CEO of XYZ does something to bankrupt XYZ... you still come out of it in shape.
Put it down To the emerging insurance market Where the loss ratio is 45% and the Combined is 90% Oh, 1-year gov. bonds are 17%.
My brother was asking a person to put $400k in commercial bank at 1% monthly for 2 months but on local currency which is strengthening.
400K in real estate. 300K in share market. for 200K will try to take some franchise. 50K in cryptocurrency. 50 K in the bank account.
$100k in Cash, $900k in VOO
300k in stocks I have high conviction in, 500k across a set of mutual funds I like, and 200k for a down payment on a house
Magni nobis id illo. Quis repellendus distinctio a consequuntur exercitationem perferendis. Aperiam magnam magnam aut amet magnam nemo doloribus. Recusandae voluptates distinctio tempore praesentium alias quas.
Est aut placeat praesentium amet omnis est molestiae. Doloremque labore repellat rerum sit tenetur vero incidunt. Vero et magni saepe consequatur deserunt modi.
Aspernatur quaerat vero dolores deleniti eius sapiente. Quae qui molestias quasi.
Odio sit fugit quia sed accusantium odit eos. Nostrum et iure facere officiis et. Vitae sunt quaerat et tempora. Accusantium atque error enim ipsum.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...