Previously, you typically needed plenty of capital in the event that you wanted to buy alternative asset classes like artwork, real-estate, or venture capital.
However, alternative crowdfunding platforms like Yieldstreet are changing this barrier. With Yieldstreet , you can buy diversified portfolio of alternative asset classes starting with only $2,500. The platform also offers direct deals for accredited investors looking to spice up their portfolios beyond stocks and ETFs.
But investing in alternative asset classes isn't something you need to do lightly. That's why our Yieldstreet review is covering how this platform works, the professionals and cons, and pricing to assist you make your decision.
What Is Yieldstreet?
Yieldstreet is really a platform that connects investors with alternative investments across asset classes such as artwork, cryptocurrency, litigation finance, real-estate, and consumer finance. The business began in 2014. Since inception, it's seen over $3 billion funded on the platform and had a 9.71% net annualized return (IRR).
The company's goal is to make alternative investments more accessible and streamlined. You are able to purchase a number of individual deals on Yieldstreet or its Prism Fund, which provides exposure to varied asset classes.
YieldStreet also lets you create goal-based portfolios, like its income or growth portfolio model, to assist you pick assets that match your investing goals.
How Yieldstreet works
Yieldstreet gives investors the chance to be involved in crowdfunding for alternative investments on the platform. Crowdfunding is the process of raising smaller amounts of money from a large number of people. So instead of having one person invest $50,000, crowdfunding allows 50 visitors to invest a minimum of $1,000 each to attain the exact same goal.
Yieldstreet also provides individual investors with opportunities to buy private structured credit deals, which is a deal where an investor will receive a minimum assured return, and the risk from the decline in earnings is protected. These deals usually are only available to institutional investors or hedge funds, though. The platform secures investments across deals including commercial real-estate, art and marine projects.
Investment minimums usually are around $10,000, which may possibly not be best for those who don't have plenty of more money to invest beyond their IRA or brokerage account. As of October 2022, over $4 billion has been invested in their platform with an 9.61% net annualized return, in accordance with Yieldstreet.
It's also important to notice that many deals on Yieldstreet are just available to accredited investors, that the Securities and Exchange Commission (SEC) defines as individuals with a net worth of more than $1 million — excluding the worth of your primary residence — or an annual income within the last couple of years of at the least $200,000 for individuals and over $300,000 for couples. The other option is always to hold certain certificates or credentials, such as for instance Series 7, Series 65, and Series 82 licenses. So if you fit these criteria, you likely won't manage to be involved in most opportunities on the platform.
However, in August 2020 Yieldstreet established the Prism Fund, which can be obtained to non-accredited investors. The minimum investment amount for assets within the Prism Fund is $2,500, which makes it a little more accessible.
You can sign up to start investing on Yieldstreet's website through Apple ID, email or Google. After choosing your sign-up method, your website will prompt you with some questions to ascertain if you are an accredited investor. If you meet with the criteria, you can start tailoring your Yieldstreet dashboard to your investment preferences and needs.
Bottom line
The good qualities of Yieldstreet include wide-ranging use of alternative investments that are backed by assets, providing a form of protection in case of default. Cons include the truth that a lot of the offerings are just ready to accept accredited investors and there are merely a limited number of investments available. Overall, Yieldstreet makes the most sense for those who have exhausted other traditional investment accounts, like brokerage accounts and retirement accounts, and have larger amounts of money to put toward alternative assets.
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