How Private Placements Diversify Your Income
How Private Placements Diversify Your Income
Over the next few weeks, I will provide some education on private placement deals and how they can add value to your portfolio.
What is a private placement deal?
A private placement is a sale of stock shares or bonds to pre-selected investors and institutions rather than on the open market.
What is the open market?
The open market could literally be anything. I actually hung out at some really cool ones in London and Seattle; however, many people think either the supermarket or the stock market.
How would a market shape an investment opportunity?
The market is the mechanism for how the investment is available for sale. Each market adds value in its own way. At its core, a market is simply a place where goods or services can be exchanged.
The stock market is arguably the most popular. The stock market’s primary value is that it provides liquidity for investors and seeks to build trust by the standards for listing on the market.
Wall Street is known for making markets. Investors who hold Apple stock don’t have to find someone to sell their Apple stock too if they want to exchange it for cash. They know there is a market where they can sell their shares on any given day. Benefits of that market are liquidity, the ability to sell quickly, and the markets’ requirements for data. Once investors know the benefits, it’s just as important to know the things to watch out for.
The stock market in the US was technically formed in Philadelphia. However, the NYSE quickly emerged as the dominant market. That market has evolved significantly over the years. The takeaway that investors must think about currently is what are the tax implications of my trades, and how do I manage my risk?
We have recently seen a lot of volatility in the market via companies like GameStop and others.
Here are some additional resources if you are interested in learning more:
Danielle DiMartino Booth’s interview with Mike Green on the impact of passive investing in ETFs: Down the Middle with DiMartino Booth — The Rise & Fall of Passive Investing w/Mike Green
George Gammon Explaining the GameStop volatility: GameStop/Wallstreetbets Fuel Hyper Bubble
The stock market is a great option for investors who are good at valuing companies’ publicly traded information and desire liquidity in their investments. However, what if you are looking for diversification from passive indexes (or cashflow) and tax benefits?
Private Placement deals offer investors an opportunity to invest in companies and projects that are tailored to their needs. Private Placement deals can offer significant appreciation, tax benefits and cash flow. They also have the benefit of providing investors with privacy which is a very important part of each individual’s asset protection strategy. Lastly, many private placement deals are available in the communities that you live in and solve specific needs.
That is what BMD Investment Group is all about!
As with many things in life, one type of investment isn’t inherently better than another. It’s your job to align your investments to your goals. However, Private Placements can offer significant benefits for investors who are looking to protect and grow their wealth building local communities with tax benefits and asset protection built in.
As with many things in life, one type of investment isn’t inherently better than another. It’s your job to align your investments to your goals. However, Private Placements can offer significant benefits for investors who are looking to protect and grow their wealth building local communities with tax benefits and asset protection built in.
If you want your portfolio to work for you and deliver a diversified stream of income that exceeds your expenses, you are in the right spot! There are several ways you can take action today. Simply fill out our Investor Questionnaire so we can get to know you or join an upcoming cashflow game!
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Until next time- share the wealth!