Many savers are pushed towards alternatives in their search for profitability. The threshold towards high risk equity funds is generally too high, where you invest in both shares and bonds. Meanwhile the capital in such funds has surpassed that of pure shares funds. In 2015 Belgian investors have put 173 billion euros into investment funds, of which 54 billion has been put into mixed investment funds. Another alternative for the classic savings account is buying diamonds.
Buying diamonds or investing in mixed investment funds?16 Jul 21
Benefits and type of mixed investment funds
Going to the stock market is a huge step for many investors. These funds are – just like equity funds – managed by financial experts that decide how your capital can optimally be divided between shares and bonds. Ex-savers can therefore rely on their expertise. By diversifying your portfolio enough between shares and bonds, you spread your risk.
Such a spread between shares and bonds does influence profitability. Mixed investment funds are for investors who want to limit their losses but who not aim for the highest possible profit.
Classic investment funds are a guarantee for investing a maximum percentage of the capital into shares. On the other end, there are flexible funds where there are no fixed rules about the division of the capital between types of funds. For that kind of funds, the fund managers decide if there should be invested in shares or in bonds based on the evolutions of the financial market. The advantage of this type of fund lies in its maximal flexibility and that the investment strategy can be adapted to the market at any time.
Buying diamonds as an alternative
The spread between shares and bonds in a mixed investment fund does not mean there are fewer risks per se. They limit the risks to a certain degree, but there always a real risk to it. Mixed investment funds are also relying on what happens on the financial markets. Shares that go down will also impact mixed investment funds. The same goes for evolutions on the bonds market. When buying diamonds, the risk is even lower and - perhaps more importantly – profitability is as good as guaranteed when buying diamonds. The diamond market is stable. The current diamonds mines will be exhausted soon and there are no new deposits. The supply will therefore not expand, while demand for diamonds from the fast growing economies like India and China will only rise.
BNT Diamonds is specialized in investment diamonds. Are you considering buying a diamond, then they have all the expertise needed to guide you.