The Power of Private Equity: A Guide for Savvy Investors

Part 1: WHY PRIVATE EQUITY MATTERS

We already know that the rich play by a different set of rules and thankfully that game has become more accessible to the average person over the past decade. 

As the great Tony Robbins says, “Success leaves clues” so I have spent a great deal of time studying what the wealthy do to keep and grow their wealth.

What did I learn? For many ultra-high-net-worth individuals and sophisticated investors, private equity is a cornerstone of their portfolios. 

Why do the wealthy invest in private equity? Let's talk about it 👇

Private equity involves investing in private companies or investments that are not publicly traded.

Some advantages (not financial advice - just education): 

👉 Longer term investment horizon vs. publicly traded assets:

This longer-term strategy can allow management to pursue sustainable, long-term growth strategies. This contrasts with the short-term pressures that public companies may face to deliver immediate results to satisfy shareholders.

👉 Alignment of interest:

Private equity managers typically co-invest alongside their investors, aligning interests. This alignment can mean that the success of the investment is a shared goal and possibly leads to optimal results.

👉 Diversification:

Private equity investment performance isn't necessarily correlated to public equity performance (stock market). This can mean less volatility in your overall portfolio's performance

Learning from the Rich

It's never been easier to allocate your investment portfolio the way the rich do! But first, we have to learn what they invest in.

Tiger 21 is an organization of ultra-high-net-worth entrepreneurs, investors, and executives.

Success leaves clues.

Here is how these folks invest:

•  29% Private Equity (alternative investment class that invests in or acquires private companies that are not listed on a public stock exchange)

• 27% Real Estate (hint: it's not just the houses they live in)

• 19% Public Equities (think stocks)

The takeaway? If you want to get the financial results that the average American gets, invest like the average American. 

If you want different results, invest in your education around how the most wealthy invest. 

Tell us in the comments below - 

How does your portfolio match up with how the ultra-wealthy invest?

In part 2 next week we will fill you in on how to find private equity investments and more. Spoiler alert: Sylvis Capital is a real estate private equity firm. 

Amy Sylvis

P.S.  Did you know that you can invest in private equity in your retirement accounts without creating a taxable event or incurring a penalty? We can teach you the 5 easy steps to take control of your retirement this Thursday, August 15. Comment in the post below if you want the registration link! 💪