For a retail investor to find investments with a Return on investment (ROI) of around 10% is not an easy task. In this article, we will review investment tools that offer an ROI of around 10% and where you can start investing with a few hundred euros!
Make 10% ROI by investing in real estate starting with a few hundred euros
Most people think that to start investing in real estate you need to have thousands of euros and in most cases it is true, but there are options how to start investing in property starting with a few hundred euros.
Real estate crowdfunding is a tool that allows retail investors to start investing in properties with 100 EUR and a few clicks.
The main principle of crowdfunding is that many investors invest small amounts thus allowing them together to invest in relatively big projects. Investing in crowdfunding is performed via licensed crowdfunding platforms that ensure that everything happens according to regulatory requirements and the platform takes responsibility for managing main processes.
Via such platforms, you can either purchase a share in a property or provide a loan to a property developer with a few clicks.
All regulated platforms are required to present statistics on historical performance including loss, costs, and so on thus you can understand what were “real” historical net returns on investments, not just promised.
There are plenty of Real estate crowdfunding platforms, platforms from old Europe could offer an ROI of around 5-8% but platforms from Eastern Europe and the Baltics can ensure an ROI of around 10%.
You can easily find platforms to invest on crowdinform.com - A list of Europen real estate crowdfunding platforms.
Learn more about real estate crowdfunding.
The best short-term investment tools with 10% ROI are Peer-to-peer loan marketplaces
Peer-to-peer loan marketplaces like Mintos, Peerberry, Eketit, and so on, are platforms where investors can invest, starting from 10 euros, in loans issued by microfinance companies from around the world and a big part of those loans are so-called payday loans, which usually have maturity 1 or 2 months and issued with interests high rates.
Thus you could find investment options with maturity of few weeks and interest rates of 10-15% p.a. which is awesome.
Such platforms offer many great tools to make investments safer and more convenient. Almost all of them offer a buyback guarantee which is a microfinance company's obligation to buy the loan back from you if the borrower fails to pay the loan back for a defined period of time, usually 60 days.
Another great tool is the so-called “auto-invest” which based on your set rules can make automatic investments and reinvest your money after repayment, thus you could set investment rules e.g. maturity no longer than 30 days and rate not less than 14% p.a. thus money will be invested for a period no longer than a month and it will not require daily management.
Offered interests are not ROI since there might be costs or losses. Most of the platforms do not charge any fees, which is good, but on a Peer-to-peer loan marketplace platform you invest in medium-high-risk products thus you might experience a loss due to a loan or microfinance company default, thus to reach 10% ROI you have to choose wisely where to invest.
You can easily find platforms to invest on crowdinform.com - A list of Europen Peer-to-peer loan marketplace platforms.
Learn more about peer-to-peer loan marketplace platforms.
Make 10% ROI by investing in business loans
With crowdlending everyone can try himself in a banker's shoes and start making money by providing loans to businesses starting with a few hundred euros.
Crowdlending operates on the same principles as crowdfunding, a large number of people are providing small amounts and thus they can finance big projects up to 5 million euros (Europen crowdfunding service provider regulation set limit).
Offered interests to investors might be above 10%, especially for loans issued in the Baltics and Eastern Europe but as mentioned above, offered returns and actual returns are two different things. Each regulated platform is obliged to provide statistics on the historical performance of loans, for example, here you will find statistics of October one of the biggest platforms in Europe. In the Performance results of October, you will very well see the impact of risk costs.
Thus to gain 10% ROI you need to do your analysis and evaluate each project you are investing in, and understand the risk and probability of default.
Learn more about crowdlending.
It is very important to remember that 10% ROI are very big returns and no one can 100% guarantee you such returns, but you can achieve them by doing your own research and analysis and understanding risk.
Remember: Direct and indirect investment in crowdfunding involves significant risks as there is a potential risk for loss of part or all of the invested capital.
Follow us on LinkedIn or Facebook and learn more about investing with crowdfunding on Crowdinform.com
We wish you a good day and successful investing!
CrowdInform