By Nirado | Nirado | 14 May 2021


Part 2


Today I will go over P2P investments. What kinds of P2P investments there are, how much money you need to start, what are the returns and what platforms are best in my opinion.  Firstly to clear up, P2P is short for Peer to Peer.

In a later post (Part 4) I will go over specific platforms that I use in detail.


So to start, there are a few types of P2P investments that are available, the biggest and most popular being loan investing

Now you might ask well what does loan investing mean? That's a very good question, you first need to understand what it is you are investing into, before making any investment. So to answer that I'll use a little analogy, here it goes:

Ben wants a car that costs 1000$ but doesn't have money for it, so he asks Mark for money. Now Mark says OK, but you pay me back 1010$. So Ben agrees, and Mark now, because he doesn't have 1000$ either, he says to 5 of his friends to give him 200$, and he'll give them back 201$. So they give him the money, that he in turn gives to Ben. After Ben gives back the money, Mark earned 5$, his friends 1$, and Ben has a car. Everyone is happy!

In this situation, you are the friend here. Now, this an extreme simplification of what actually goes on but the principle is the same, many people pool money to use it as a bank and give out loans trough a company registered to do that.

The main difference to our story is that the company (usually) doesn't give out loans itself, but rather send money to loaning companies. 

Second most popular type of investment in the P2P world is real estate.

Now this can be either rental properties or building/renovating properties to later sell them for profit. Sometimes these types of properties if well chosen can bring amazing returns, but if rentals then expect safer, lower returns, but without any work by you.

The principle is the same, you give money, they pool it, use it, give back a percentage of the profits to you. 

Now, legally speaking there are a few ways these companies are organized, so that you are protected in case that something goes wrong with the platform, and I'll discuss different legal ways investors are insured by different platforms in another part of the series (Part 5).

In this series of posts will be covering my favorite investing methods, the P2P platforms and staking. I'll share my experiences, the platforms that I like and don't like and what returns I have realistically been getting. I'll also cover the safety and regulations of the platforms and to what extent your assets are protected. 

Thank you for reading and if you want to help me make more of these articles tip me, it's free :)

Note: This is not financial advice. Always invest at you own risk.


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