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Why invest in alternative assets?
An investment in alternative assets is an investment in the real economy – the assets are real, the jockeys are real and the numbers are real.
Slow Economic Growth. The unemployment rate, corruption and COVID are major contributing factors in low GDP Growth. Low corporate investment triggered by policy uncertainty, results in less job creation and a slow economy.
Alternative assets are not correlated to market volatility due to the lack of market sentiment. Alternative asset performance is based on company performance and not market sentiment due to supply and demand.
Due to the diversification of the alternative asset classes the standard deviation is reduced, resulting in lower volatility of the portfolio.
Investment risk is mitigated by investing in a minimum of 7 companies in 7 different sectors. This is possible with a Category 2 investment license.
Minimum investment: R 250 000
Yield: Compounding 11.78% over 5 years added with up to 6.49% boost if invested for the full term
Investment term: 5 years
Notice period: 3 months
Diversification factor: The investment is diversified over more than 7 companies in 7 different sectors
The boost: A boost of up to 6.49% can be expected if invested in the growth option for 5 years. If the switch is made after year 4 the boost is up to 3.25%. If the switch is made after year 3 the boost is up to 1.62%. If the switch is made before 3 years the boost will be forfeited. The boost is not a guarantee and is based on investment performance.
Penalties: There is a 10% penalty if the investment is withdrawn within the first year, from year 2 the penalty is 5% until the investment has reached maturity.
*No yield is payable from the withdrawal notice date.
To offset the costs of the investment, a hurdle rate is set. This means that if the product provider does not reach the set hurdle rate, no costs may be deducted from the investors' investment.
The Hurdle Rate is the yield allocated to the client. Any costs, admin fees, performance fees, and broker fees are paid from the yield received above the hurdle rate.
This ensures that the client is set as first priority and the fund performance needs to be driven by the investment managers to be able to offset any costs incurred on the investment.
Investing an R250 000 lump sum. Full term expected accumulated yield of up to 81%, boost included.
Investing an R250 000 lump sum. Full term expected accumulated yield of up to 81%, boost included.
Vesting - The boost yield at the end of the investment term can be up to 6.49% if the investment is invested in the growth option for the full term. If the client withdraws after year 4 the boost is up to 3.25%. If the client withdraws after the year 3 the boost is up to 1.62%. If the client withdraws before 3 years the boost will be forfeited. The boost is not a guarantee and is based on investment performance.
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Building wealth, Optimate Solutions South Africa is your trusted partner in the alternative investment realm, offering bespoke solutions to your unique investment needs.
Clients have access to a boutique of Private Equity and 12J
Alternative investment vehicles according to their overall investment objective.