Outlook Money
Nowadays, Alternative Investments options are gaining popularity beyond the conventional choices of stocks, bonds, or fixed deposits. Three such popular avenues are Real Estate Investment Trusts (REITs), Infrastructure Investment Trusts (InvITs), and Peer-to-Peer (P2P) lending.
REITs are companies that possess, manage, or fund income-producing real estate across different sectors, including commercial, residential, and industrial properties.
REITs provide diversification and accessibility by allowing investors to participate in real estate investment with less capital as compared to directly investing in a property.
InvITs are financial tools designed to attract investment into infrastructure projects like highways, power plants, and transmission lines. They collect funds from investors to invest in different infrastructure assets.
InvITs aim to deliver consistent income through dividends derived from infrastructure projects. They present a low entry barrier, allowing access to extensive infrastructure ventures without requiring substantial capital, thus including retail investors.
Peer-to-peer lending platforms link borrowers with individual lenders. This fintech model allows people to obtain loans from other individuals, while lenders can earn interest income that is usually higher than what traditional savings products offer.
Borrowers apply for loan on the website, where they are evaluated based on certain criteria and categorized by risk level. Investors fund the available loans on the platform. Interest accumulates over time as the borrower makes payments. The platforms facilitating these transactions earn fees and often include risk management features.