Here's How The Rich Invest Their Money

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References

I would highly recommend watching the Rational Reminder Podcast episode on Alternatives.

The Performance of Hedge Fund Performance Fees

Has Persistence Persisted in Private Equity? Evidence from Buyout and Venture Capital Funds

How to Use Alternatives in Your Portfolio

RISK WARNINGS AND DISCLAIMERS

Capital at risk. Past performance is used as a guide only. It is no guarantee of future returns. Different funds and asset classes carry varying levels of risk depending on the geographical region and industry sector. You should make yourself aware of these specific risks prior to investing. The property market can be illiquid; consequently, there can be times when investors will be unable to sell their holdings. Property valuations are subjective and a matter of judgement. VCTs, EIS and SEIS should be regarded as higher risk investments. They are only suitable for UK resident taxpayers who can tolerate higher risk and have a medium to long term time horizon. Owing to the nature of their underlying assets, these investments are highly illiquid. Investors should be aware that they may have difficulty, or be unable to realise their shares at levels close to or that reflect the value of the underlying assets. Prevailing tax rates and reliefs are dependent on your individual circumstances and are subject to change. We do not provide tax advice. Any examples used in the video are for illustrative purposes only and you may get less back than the figures shown. This video does not constitute personal advice. We do not take any responsibility for third party websites and content we may link to from this video. Issued on behalf of Nova. Nova is a trading name of Nova Wealth Limited, which is authorised and regulated by the Financial Conduct Authority (FRN: 778951) and is a limited company registered in England & Wales (10739796).

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00:00 The question?
01:25 What are they investing in?
03:30 The Power of Diversification
04:49 Commercial Property
06:17 Property Funds
07:07 Commodities
07:36 Private Equity
10:57 Private Equity Funds
14:00 Hedge Funds
15:32 Conclusion

[JamesShack]

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[DavidLucas-sorr]

I feel investors should be focusing on under-the-radar stocks, and considering the current rollercoaster nature of the stock market, Because 35% of my $270k portfolio comprises of plummeting stocks which were once revered and i don't know where to go here out of devastation.

[CameronFussner]

Sometimes Protecting your capital is much more important than making money. Basically because if you lose your capital, making money is much harder. ''Missing the train'' vs. ''losing your money''. There are a lot of trains, but if your money is gone, it's over.

[sirheisenberg]

Building wealth involves developing good habits like regularly putting money away in intervals for solid investments. Instead of trying to predict and prognosticate the stability of the market and precisely when the change is going to happen, a better strategy is simply having a portfolio that’s well prepared for any eventually, that’s how some folks' been averaging 150K every 7week these past 4months according to Bloomberg.

[SoledadHughes-qi]

I just sold a property in Portland and I'm thinking to put the cash in stocks, I know everyone is saying it’s ripe enough, but Is this a good time to buy stocks? How long until a full recovery? How are other people in the same market raking in over $200k gains with months, I'm really just confused at this point.

[davidreichert]

A good rule of thumb is that if your portfolio is too boring to discuss in social situations, you've done it right.

[spivvo]

I am a retired institutional fund manager (36 years in the industry). I’ve seen it all from the inside and agree with 100% of what this gentleman is saying. The money that wealthy people put into alternatives is their “fun money” the equivalent of an ordinary person buying a few lottery tickets. They kid themselves that itis diversifcation but it’s just thinly disguised greed and generally what they gain in return they give away in fees…. And that’s the lucky ones. So good to see such sound advice being given.

[AnthonyJustice-ix]

I will be forever grateful to you, you changed my entire life and I will continue to preach on your behalf for the whole world to hear you saved me from huge financial debt with just a small investment, thank you Brooke Miller.

[paulvilagos]

Thx James for saying it outright : "People shouldn't consider their homes an investment" thank you very much.

[juriteller]

No, do NOT copy them, they invest like this because they are already rich. If you want to get rich do NOT copy them.

[themiddle]

Just one point that needs emphasised. The JP Morgan survey (or similar) of HNWI is a self-selecting group. The richest cohort of individuals (excepting inherited wealth) are typically company owners, rather than those taking income from employment. As such, the stats are always going to show a substantial % of HNWI having their wealth in private stocks, since they are company owners. That’s less of a result of a ‘wealth strategy’ of the HNWI - if you excluded owners of their own companies (as opposed to people with the wealth able to buy into private equity), the mean average holdings would no doubt be rather different.

[Greylocks]

If you don’t understand it don’t invest in it…

[AnOldGuy]

My wife and I are 75. We have always invested 100% in stocks. The broad market.

We set a goal for the annualized return. The broad market gave us that and more. There was and is no need for us to look for other investments.

[edwardkenworthy]

It's worth remembering that "The Rich" also invested in Theranos.

[DonatellaVersace]

I believe investors should focus on under-the-radar stocks, especially given the present rollercoaster nature of the stock market. 35% of my $270, 000 portfolio consists of collapsing stocks that were previously respected, and I don't know where to go from here.

[tigerrx]

You’re also looking at data for people who are in wealth preservation, not aggressive wealth creation

[OllieX]

Rich people already have plenty of money and don’t need to build wealth, they just want to conserve it. So they’re gonna go for less risky assets, but for the rest of us we still need to build it.

[ArashHildeman]

I lost over $80k when everything started to tank. Not because I was in an exchange that went belly up. I was just stupid to hold and because that's what everyone said. I'm still responsible. It just taught me to be a better investor now that I understand more of what could go wrong. It took me over two years of being in the market, I'm really grateful I found one source to recover my money, at least $10k profits weekly. Thanks Charlotte Miller.

[hTyKn]

I'm sticking to my index funds. Warren Buffett famously won a $1m bet that a hedge fund manager couldn't beat the S&P500 over a 10 year period. He won easily and if it's good enough for Buffett then...

[themachine]

That last analogy about Federer is a really great point.