An Explanation of Risk Aversion and Investing

An Explanation of Risk Aversion and Investing

Those who do not invest outside of traditional asset classes such as stocks and 401k plans may consider non traditional assets risky. Further, they may assume those who invest in real estate, businesses or other forms of private equity extremely risky people.

However, this mistaken assumption about these types of investments and investors is not only incorrect but the precise reason many middle class Americans do not progress to the next level in their finances and wealth building.

Managed Risk

Sure, there are quite a few risk driven knuckleheads out there, but the most successful and best to model are those who calculate and manage the risks. These are experienced investors that invest with a plan.

Multifamily Asset Class

Here is an example for the Multifamily asset class. To the inexperienced, the identifiable risks are unpredictable market cycles, losing money on the investment and not being able to sell it.

To the wise investor, these concerns are minimized and removed altogether by buying and managing right. This means buying undervalued assets and comfortably achieving the growth and improvements, while generating cash flow on day one. Does that sound risky? Not so much.

Good active and passive investors alike know that not all investments are created equally. The best are those that pay you on day one and have built in equity. That way, the upside from continued forced appreciation and the eventual sell are the much welcomed icing on the cake!

As a busy professional, one of the best financial decisions you will ever make is learning new investment strategies and working with those whose values and skills align with your personal goals and criteria. Discover the benefits of multifamily syndication and find out if passive investing is right for you.

Safe Investing!

RRII


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Rodney Robinson II
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