What you should be looking for with any investment
The 3 c’s
- Cash Flow
- Clarity of ROI
- Collateral
Clarity of ROI
Make sure the rate of return is predetermined. This allows you to plan what you can do with your money
View more detailsClarity of ROI
Clarity of ROI refers to the investor's ability to easily understand and quantify the return on investment (ROI) of a particular venture. It's about having a clear and transparent picture of how much profit or loss an investment is likely to generate.
For investors, clarity of ROI is important because:
- Informed Decision-Making: A clear understanding of ROI allows investors to make informed decisions about where to allocate their funds.
- Risk Assessment: A transparent ROI calculation helps investors assess the potential risks and rewards associated with an investment.
- Performance Tracking: Clarity of ROI makes it easier to track the performance of an investment over time and compare it to other opportunities.
- Communication and Reporting: A clear ROI metric facilitates communication and reporting between investors and investment managers.
One of the things that we strive for here at Good American Lands, is to provide you with that clarity before you decide to invest. No investment is without risk and we want to make sure that you go into any investment with us, fully aware of what your returns would be.
In essence, clarity of ROI is about having a straightforward and understandable way to measure the financial success or failure of an investment. When ROI is clear, investors can make more confident and strategic decisions about their portfolios.
Cash flow
Look for investment options that give you steady cash flow. Having income predictability is important when planning your estate.
View more detailsCashflow
Cashflow is the lifeblood of an investment. It's the net amount of money that flows in and out of an investment over a given period. In simpler terms, it's the difference between the money an investment generates (income) and the money it costs to maintain (expenses).
For investors, cashflow is crucial because:
- It indicates profitability: A positive cashflow means the investment is generating more income than expenses, a sign of financial health.
- It provides liquidity: Regular cashflow can be used to reinvest in the investment, pay bills, or withdraw funds as needed.
- It signals stability: Consistent cashflow suggests a reliable and predictable investment.
- It can be a valuation metric: Investors often use cashflow to determine the value of an investment, especially for real estate and businesses.
If Cashflow is what you’re looking for, our Note investments are your best option. Notes are designed to provide you with regular monthly payments up until the entire borrowed sum plus interest are paid off.
In essence, cashflow is a measure of an investment's ability to generate income and cover its costs. A strong cashflow is a positive indicator of an investment's potential for growth and financial stability.
Collateral
Look for deals where you are not blowing your money off, the way you would when buying stocks. Look for the guarantee of a tangible asset as a backup when investing
View more detailsCollateral
Collateral is an asset pledged as security for a loan. It's essentially a guarantee that the lender can seize if the borrower fails to repay the loan.
Here are some common types of collateral:
- Real estate: Houses, apartments, and commercial properties
- Vehicles: Cars, trucks, motorcycles, and boats
- Investments: Stocks, bonds, and mutual funds
- Valuable possessions: Jewelry, antiques, and artwork
The purpose of collateral is to protect the lender's financial interests. If the borrower defaults on the loan, the lender can sell the collateral to recoup their losses. At Good American Lands, our investments usually have Land as collateral. And we try to make sure that the market value of the property is higher than the amount you’re investing. This way, even if the loan defaults, you have enough equity in the deal to get your money back.
The value of the collateral must be equal to or greater than the amount of the loan. This ensures that the lender is adequately protected in case of a default.
Why the stock market isn’t for everyone
Let’s address the elephant in the room - the US Stock Market. While it is possible to have big gains by investing in stock or the S&P 500, it is also possible to have big losses. People don’t like talking about losses in the stock market and it isn’t a popular thing to say - but it’s true, that you can lose money in the stock market.
If you’re looking for something that’s boring and steady as far as your money is concerned - the stock market may not be for you. “The Big Short” is a must watch educational movie about how big banks and the stock market work. Most people are in the dark about how their money is being put to use. Here’s a clip from it - replaying real life events from the Sub Prime Mortgage crisis of 2008.
Different types of investments and their returns
Here at invest.goodamericanlands.com, we focus on 3 types of investments:
