Our website use cookies to improve and personalize your experience and to display advertisements(if any). Our website may also include cookies from third parties like Google Adsense, Google Analytics, Youtube. By using the website, you consent to the use of cookies. We have updated our Privacy Policy. Please click on the button to check our Privacy Policy.

Trusts at cost, an alternative to uncertainty in investments

Trusts at cost, an alternative to uncertainty in investments

In the last year, the planet suffered a series of circumstances that generated a rarefied investment climate. On the one hand, the wake of the COVID-19 pandemic, with its health and economic impact that, at the same time, left a series of social and cultural transformations that seem indelible and matures the way we work and live in cities. On the other, it arose the Russian invasion of Ukrainewith its geopolitical impact and in the economy from inflationespecially with the increase in raw materials such as oil and natural gas, which also lowered growth expectations in countries and companies. The world thus became a soup of general uncertainty.

Put in concrete numbers, the IMF estimated a slowdown in the economy that went from will grow from 6% in 2021 to 3.2% in the following year, which represents the lowest return since 2001 after the financial crisis and COVID-19. And there seems to be no end point to this scrambled scenario.

Volatility in an election year: should I invest in pesos or dollars?

One of the great learnings of this year, as if it were necessary to remember it, is that absolute certainty in investments does not exist. Even the cryptocurrencies that revolutionized the global economy and closed in a savings magnet -8% of Argentines selected them as an alternative, according to a global study by Chainanalysis- going through a period of strong turbulence.

The impossibility of predicting what will happen to the financial market does not stop movements. With the solidity that real estate developments infuse in general, a specific figure appears that always provides predictability in crises: cost trusts. In December 2021, specifically, the National Value Comission update an interannual growth of 151% in the total registered trusts at cost. This is explained because, on the one hand, small savers continue to need new investment mechanisms while, on the other, large investors seek solid economic structures before taking new steps.

Cryptocurrencies could be part of laundering
Cryptocurrencies are going through a period of strong turbulence.

The application of this non-traditional model is an alternative to boost the economy and with low risks for all parties. In other words, there is not a single capitalist who risks 100% and then sells according to a defined value, but a fragmented investment that democratizes the participation of “subscribers” in a common long-term project.

One of the main advantages is that the entry barrier is much lower. The amounts are more accessible and, in many cases, can be paid in a quota system. A direct consequence follows from this: the revaluation is automatic once the project ends and is the responsibility of each small investor.

In addition, the trust is made up of experts who commit individually with the success of the businessTherefore, they seek to guarantee professional management and asset protection. One of the clauses is that, beyond the risks and possible changes in the amounts and terms, the real estate development is concluded.

What are the 5 companies to consider to invest in 2023

In uncertain times, project security It is no longer a minor issue. The background of the developer and the participation of banking entities or other institutions supporting the project are guidelines to take into account.

Lastly, it is still important macroeconomic situation of each country. Today, the possibilities of investing have no borders and, for example, some Argentine technology companies such as MercadoLibre, Turismocity and Auth0 bet on UruguayAccording to estimates by the World Bank, its economy grew by 4.8% in 2022 and would remain stable in the future.

As they say, crises are an opportunity and investment is no exception. Finding mechanisms such as cost trusts adapted to these times, reliable and economically affordable is the key to success in overcoming the period of global uncertainty.

*member of +Cologne

You may also like

By Robert Collins

You May Also Like

Orbitz