You know we are dividend investors! Heck, we are fully transparent and share our full dividend stock portfolios on our website. With that said, we also have a few investments that aren’t dividend stocks.  The alternative investments have grown to over $12,000. While this represents approximately 2% of our overall portfolio, the value has become a meaningful sum.  Therefore, in this article, I’ll share 3 investments that are not stocks!

We are going to jump right into and start discussing the investment options. After all, we are not messing around! Warning. This post may contain affiliate links.

Investment 1: Fundrise

Fundrise, Real Estate Investing, Crowdfunding

Fundrise is our largest non-stock investment.  Fundrise is an is an online crowd funding platform that allows investors to invest into real estate several different real estate funds that meet your investing objectives. We are landlords without the hassle of collecting rent and maintaining properties!

Fundrise Funds have different investment strategies. Funds can focus on growth while others focus on income. Any guess which fund we invest in? That’s right, we focus on the investment fund. My wife and I automatically invest $100 each month into our Fundrise account. In total, we have added over $5,100 in the company’s traditional real estate investment funds.  The Fundrise fund we are invested in owns over 145 real estate projects/properties and produces a solid stream of dividend income and growth. The value of this position is over $5,600 and we have received over $120 in dividend income through the first 9 months of 2022.

Read: Lanny’s Q3 Fundrise Update

The cool thing about the Fundrise platform is that over the years, the platform has also offered several other alternative investment opportunities.  We have taken advantage of two of the opportunities over the years.

First, we invested in Fundrise’s IPO.  No, Fundrise isn’t a publicly traded company.  Rather, they offered real estate investors the opportunity to invest in the company’s Internet Public Offering.  As an avid user of the platform, we jumped on the opportunity to invest in the company we believe strongly in and love promoting to others. We invested three times in Fundrise’s IPO when the share prices were as follows: $8.45 (2019), $9.54 (2021) and $13.08 (2022). Today, the company’s share price is $15.15 per share!

Second, in 2022, Fundrise launched the Fundrise Innovation Fund. The fund is a private equity fund that focuses on investing in tech, fintech, and other high growth opportunities. I wrote in detail about the innovation fund and why I decided to invest in the linked article. When the fund opened, I decided to invest $1,000 in the innovation fund. We are still waiting on the first update in market value and investment performance. Can’t wait for that newsletter!

The following chart summarizes the overall dollar amount of the three investments discussed above.  In total, our Fundrise portfolio is $8,787.29. We are on the verge of crossing $10,000 in Fundrise alone! 

Investment 2: Sweater  Investments

Sweater Ventures is a unique investment platform that allows individuals access to a venture fund. This is investment is similar to the Fundrise Innovation Fund that I discussed earlier, with one major difference.  While Fundrise’s VC fund invests in tech, fintech and high growth early stage companies, Sweater has a much different investment philosophy. Sweater invests in early stage companies that are consumer facing and consumer focused. Sweater’s goal is to grow its investment portfolio to hundreds over portfolio companies to grow significantly and diversify risk.

Learn more about Sweater Ventures by clicking here

Once again, I liked the opportunity to participate in a venture fund that allows individual investors to invest in early stage companies without committing a significant amount of capital. The minimum invest is $500. We doubled the minimum and invested $1,000 in Sweater in April 2022. Since our investment, Sweater’s VC investment portfolio has added several new investments. The fund has 13 investments. Investments include a credentialing company, venture capital fund investing in companies founded by women, a canned wine company, several finance apps, and other companies.

Now that we have several quarters under our belt, we are starting to see some growth in the VC Fund’s market value. The reported NAV has grown from $20 per share at inception to $20.08 per share (as of 10/14/22). Therefore, our fund’s current market value has grown to $1,004. That is a nice .4% increase in a short 7 months.  Believe it or not, that is outperforming the S&P 500 in 2022!

If I’m happy with the performance at the end of the year, I’ll definitely considering adding another $1,000 into the fund and continuing to grow our investment in Sweater Ventures.

Investment 3: Crypto

Oh man. Here we go. In 2021, I rode the crypto wave and invested a small amount in cryptocurrency. This represents such a  This includes Bitcoin (BTC), Ethereum (ETH), stablecoins, and a few others.  For a period of time in 2021 and 2022, I invested over $4,500.  My strategy was to invest small dollar amounts at a time on platforms that allowed me to earn interest. I’m sure many of you are starting to shake your heads for a few reasons.

First, we all know what has happened to cryptocurrency in 2022. It has gotten crushed. Bitcoin is below $20,000 and Ethereum is below $2,000 after the merge. Both are well off their all time highs. Therefore, I’m start a massive unrealized loss in the face. My current portfolio value is $3,164.

Second, to make matters worse, the crypto crash has hurt me in another way. I mentioned that I was earning interest on my crypto investments. When I initially began investing in crypto, I did so on BlockFi. Then, at the beginning of 2022, I switched our investments over to Voyager Digital. Voyager ran into issues when the price of crypto fell and the platform collapsed. Ultimately, Voyager filed bankruptcy. Frustratingly, until recently, our funds have been locked up at Voyager. There has been uncertainty about how much of our investments on the platform will be returned to us, and the form in which we will receive our investments. Recently, it was announced that Voyager’s assets were auctioned to FTX for $1.2b+. Hopefully soon, we will learn the fate of our frozen assets and the value we will be able to receive once we are migrated to FTX’s platform.

The crypto experiment over the last year and a half has been eye opening. I’ve learned a lot of lessons about investing not only in this space, but other new ventures as well. It is critical to perform diligence in the investments, investing platform, and to make sure that you truly understand what your are buying. This experience has showed me what can happen when a hot investment turns south quickly, and there isn’t a strong, fundamental business or asset backing the investment. That’s why I like investing in blue chip dividend stocks. You know the companies, brands, and their long term history of increasing dividends in good and bad economic cycles.

Summary

There we have it. Our three alternative investments: Fundrise, Sweater Ventures, and cryptocurrency. The total investment isn’t large when compared to our full portfolio. It accounts for 2% of our total portfolio’s market value. However, the dollar amount of the investment is becoming material.  Some degree of diversification is important. I’m content with the current allocation we have towards alternative investments and would even consider growing this allocation to 5% over the years!

Do you invest in these three investments? Do you invest in Fundrise, Sweater, or cryptocurrency? If you are a dividend investor, what portion of your portfolio is allocated to non-dividend stocks?

Bert



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