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Certainly Wealth- sounds too good to be true?

Discussion in 'General Property Chat' started by bez23, 23rd Apr, 2016.

  1. bez23

    bez23 Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    138
    Location:
    Adelaide
    Saw this link in PC sponsored links: Certainty Wealth

    $300k investment and 25% return in 1 year. Guaranteed capital.

    That makes $75k PA. Does this mean that I can retire now?
     
    Last edited: 23rd Apr, 2016
  2. Foxdan

    Foxdan Well-Known Member

    Joined:
    22nd Jun, 2015
    Posts:
    115
    Location:
    Hills district, sydney
    It's on the Internet so it must be true. Let me know how you go.
     
    TheGreenLeaf and Terry_w like this.
  3. Beano

    Beano Well-Known Member

    Joined:
    7th Apr, 2016
    Posts:
    406
    Location:
    Brisbane
    Looked at that link
    Its good but not as good as it first looks
    1 capital is guaranteed not return
    2 there is borrowing hence there is risk
    3 it looks like a development hence there is risk
    I prefer lower risk lower returns
    Leased property
    A net yield of 9pc funded at 4pc returns 20pc on capital
     
    HUGH72 likes this.
  4. Corey Batt

    Corey Batt Finance Strategist Business Plus Member

    Joined:
    14th Jun, 2015
    Posts:
    1,167
    Location:
    Adelaide, SA
    There's a lot of similar funds around - which will offer 10%-30% returns p.a, naturally based on a risk profile. You need to be careful with the terms of the lend, as a lot will specify a % return at completion of project - which may dilute the return to subpar results. As an example:

    '15% return over 12 months' - terms noting completion of project, estimate completion date 12 months.

    In reality the project takes 3 years for final sell down of the end development - providing a 5% p.a yield for an investment which has a higher risk profile compared to other asset classes.