Recent economic collapses and catastrophes have left many investors reeling. Modern investment strategies must not only achieve profitability in their own right but must also help investors to recoup their losses over the past decade. By opting for some of the lesser-known high-yield options in the financial marketplace, private investors can often achieve much better than market returns on their initial investments. Here are five secrets of the top high-yield investment firms.
Municipal Bonds
These securities are even more profitable than they appear at first glance. Municipal bonds are generally exempt from federal taxes. What’s more, they may also be tax-free at the state and local levels as well. This can boost the real return on investment for muni bonds to a healthy double-digit level. Best of all, the moderate risk ratings of most of these bond issues can be used to balance high-risk investments within a diversified portfolio.
Life Settlement Pools
Once overlooked by investors as a high-risk proposition, life settlements have become big business for many investment firms. By acquiring and packaging numerous life settlement agreements into risk-diversified funds, these investment professionals can provide a much more acceptable level of risk for their clients and can ensure the most profitable return on investment for investors willing to take a calculated risk for increased yield potentials.
Junk Bonds
Don’t let the name fool you. Junk bonds can perform exceptionally well in faltering economies, especially when risk is minimized through a diversified fund. Overpaying for these bonds is currently the primary risk for investors: Savvy fund managers have been scooping up these deals for the past few years and have run up the price to a minor degree.
Canadian Real Estate
Despite major downturns in the U.S. real estate marketplace, Canadian real estate investment trusts (REITs) have remained amazingly resilient and continue to offer solid opportunities for investors interested in taking the long view for their investment portfolio. In recent years, some Canadian REITs have been posting double-digit profits for their investors. Unfortunately, this has attracted a fair amount of media attention in recent months, which may make this a less profitable investment selection for the future.
Business Development Firms
Business Development Firms, or B2B companies, deliver targeted financial services to the hard-hit small-business sector. With many banks still not lending at adequate levels, business development companies have stepped in to fill the gap with short-term collateralized loans, factoring arrangements, and numerous other short- and long-term funding arrangements designed to help the business world and to rack up outstanding profits for their shareholders. Many investors have seen double-digit results from these business development enterprises in recent years, making them one of the most profitable sectors in the B2B marketplace.
By taking a chance on one or all of these investment opportunities, investors can enjoy exceptional profitability and can recoup some of their losses in the real estate and technology sectors. This can create a solid foundation for future investment and growth as the United States and global economies continue their slow but steady recovery process.
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