Who doesn’t want to earn a decent profit? Well, when investing, it is important to be aware of the risks involved. We give you a few tips along the way. Make sure to invest wisely.
There is no such thing as no risk
When it comes to investing, there is always some form of risk involved. No guts, no glory, right? Well, whoever tells you there is no risk: it’s probably too good to be true. Accept the fact there that there is a possibility that you lose a part or all your money when investing in a particular project. Be aware of this when investing.
Compare the available platforms
There are many platforms available when it comes to crowdfunding. There are major differences in returns, collateral, risks, customer service, etc. One platform has just started where others have years of experience. Make sure that your returns are at an optimum and your risks as low as possible. Compare and decide for yourself.
We can’t stress this enough: diversify your investments. We recommend investing across multiple platforms, countries, lenders and branches. If an investment turns out badly, at least it’s a small part of your investment portfolio.
Set up your investment strategy: keeping it simple
When you start investing, keep it simple. Start with one or two platforms and an amount of money that makes sense to you. Limit the amount of money you want to invest in a particular project and/or platform beforehand to minimize your risks. Also, it’s also worth considering for what amount of time your money will be invested. Are you favoring 30 days or 72 months?
Take advantage of bonuses and promotional campaigns
Many platforms offer all sorts of bonuses when signing up. Options vary from a fixed amount, a percentage of the amount invested or a combination of both. This will lift your returns significantly.
Keep yourself informed
Don’t rely solely on the information you get from a particular platform itself. Inform yourself for instance by checking the chamber of commerce, read relevant blogs or any other information that might serve you. One of the best ways to keep yourself informed is by choosing for a platform which is paying on a monthly basis: every month you get to check whether you get your investment back.
Favor secured loans or any other form of guarantee or collateral
Strictly speaking there are two types of loans: secured and unsecured. We recommend going with secured loans. When things turn sour, rest assured that for example a car or real estate can serve as collateral. Get through the details of any form of (buy back) guarantees: check whether a company is capable of fulfilling its financial obligations. Lastly, any form of supervision from institutions like for instance the ECB or the Chamber of Commerce is definitely a plus.
Evaluate your investments
Your efforts shouldn’t stop once you’ve made an investment. Check whether your investments are still paying off or that other opportunities are serving your needs better. New options arise often, so keep on close eye on those possibilities.