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Dear Fellow Investor,
A friend named Spencer was telling me about his latest hottest stock pick the other day. He went on and on and on about this latest “get rich quick” scheme...
Then I asked him about his other investments and he told me about this and that IPO.
They were all the same! No real value being created...no wealth built...no long-term results.
That’s because his strategy was always the same — speculation!
His investments were missing one defined element for building real wealth:
An Exit Strategy
Having a real exit strategy means you’re invested for the long-term.
Selling a stock because Jim Cramer tells you to sell is not an exit strategy.
Investing for the long-term means NO timing...and NO worries.
Gone is agonizing whether your investment is heading up or down next...or whether the entire market is about to top out. (Obviously, a valid question these days.)
Making money in investments like stocks is often based purely on speculation — hoping there's a greater fool down the road when you're trying to sell.
The key to getting out of this rat race is finding investments with defined exit strategies.
Here’s why....
Real Profits — According To Plan
Investments with defined exit strategies usually mean management has defined goals for acquisitions, business operations and disposition — all essential for generating cash flow and appreciation.
What investment in your portfolio is this well thought-out in advance?
Committing your investment to a specific period gives management time to execute their strategy and business plan so they can pay you back with significant profits.
If they have investors coming and going as they please, they’ll never have the stability to carry out their strategies and achieve their goals.
For generating true wealth, assets with defined exit strategies that are illiquid generate the double benefit of cash flow and appreciation. More-liquid assets like stocks make you rely on speculation for profits.
The data backs this up: According to JP Morgan Chase Asset Management, the retail investor has received an average 2% annual return in the last 20 years. That’s not even enough to cover inflation.
Institutional and ultra-wealthy investors understand liquid investments that rely on speculation to make money is a fool’s errand. It’s simply gambling.
They want their investment capital to be put to productive use that can generate income and grow.
That’s why they’re willing to leave it for a defined time before exiting the investment. Stocks and most common investments can’t offer this.
Building true wealth requires taking a long-term perspective.
With an illiquid investment with a clear acquisition plan, plan of operations and exit strategy, cash flow can be generated while the asset appreciates before being sold off. Investors are better off in the long run because illiquidity prevents them from making rash decisions that will prevent them from reaping the benefits of their investment before it’s time.
Why do successful investors prefer investments with lock-up periods and defined exit strategies, such as real estate and, indirectly, real estate private equity and real estate syndications?
It’s because they understand that it takes time to build value in a real estate investment. They know that in the long term, that type of investment will provide passive income opportunities essential for building wealth. Passive income, when reinvested, builds upon itself, building wealth that speculative assets can’t match.
An investment with a defined exit strategy will never be found on the stock market and, as a result, never be exposed to the volatility caused by mob rule. In a private real estate fund with a five-10 year exit strategy, illiquidity prevents investors from liquidating their investment capital before it has a chance to produce returns and grow.
Look to investments with a defined exit strategy.
The returns on real estate are predictable and reliable — it’s just a matter of leaving your money during that lock-up period to reap true wealth-building returns.
The bottom line? For higher returns that allow for true wealth creation through passive income, investors should seek out investments with income and defined exit strategies — ones that are not prone to Wall Street volatility.
Find out more today with our two special reports — get them instantly at the link below.
Find out more today
with our two special reports.
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