Tag: <span>stock market</span>

There used to be a game show on TV called It’s a Knockout, where amongst lots of other silly games, contestants – wearing daft costumes that made walking difficult – used to carry buckets of water across a slippery surface whilst being bombarded with water cannons or sandbags, to try and fill a receptacle at the end of the course.

Obviously, they spilt a lot along the way and were occasionally wiped out altogether and had to start again. But there’s no doubt that if they were dogged enough and did it for long enough, eventually they would fill the receptacle.

This often seems to me to be a good analogy for the stock market.

The award-winning financial advice website, “This Is Money” ran an analysis last year confirming much the same. If you’d invested over any ten year period over the last two decades (except two dodgy phases in the dotcom boom and the financial crash), you were 95% likely to turn a profit. And assuming you reinvested your profits, the average return generated would have been 70%!

Sounds like investment Nirvana, doesn’t it?

But let’s examine those figures a little more closely.

And – for now – we’ll set aside those periods of heart-in-mouth panic as you watch your stock slide and gnaw your fingernails away as you decide whether or not to leave your investments where they are. That’s all part of stock investing, seasoned veterans will tell you. Take your lumps like you take your jumps.

If we accept that you’ve ridden the roller-coaster, pushed your ticker back down to its rightful position each time the market bounced it up into your throat, fought against all your instincts to reinvest hard-earned profit back into the maelstrom from whence you’ve just extracted it…what are you left with?

A 70% profit over 10 years! Sounds like a lot if you consider that if you’d started with £100,000, you’d now be sitting on £170,000.

But over 10 years? If we spread that out on an annual basis and apply a little simple compounding, it amounts to just 5.45% per year. Is that a fair recompense for all the cardiac distress?

So is there an alternative? Property?  Well, it’s more secure, but again, it ties up your capital for years.

So if you could make an annualised return of three times that amount without all the turmoil and without the long-term capital handcuffs, wouldn’t you consider it? Heck, wouldn’t you even do it for twice that average stock market return?

That’s why smart investors have started looking at loan-based crowdfunding of property. Lending to screened-and-approved developers looking for investment to get their projects off the ground. Usually, they’ll have agreed bank funding for around 60% of the building cost and they’ll have their own equity to sink into it too. But the capital gap in between is increasingly being filled by crowdfunders on the FCA-authorised CapitalStackers platform.

And it can be impressively lucrative. Recent investors in a CapitalStackers funded development in York made annualised returns of up to 22.5% in just eight months.

More typically, investors in two current CapitalStackers deals are set to make annualised returns of between 10% and 17%. Those figures look even more attractive when you know that all CapitalStackers investors are able to choose their own return, predicated on the level of capital risk they’re prepared to take (although the risk itself is not terribly off-putting, given that the investment is secured on the property, the developer’s equity/profit is there to cushion any drop in value – and the Loan-to-Value on these deals is within a sensible range of 55% to 72%).

So how might this kind of investment compare with the stock market?

Well, taking a mid-point CapitalStackers investment as an example: If you were to start with £100,000 – on an agreed return of 13.5% – after one year, your nest egg would be worth £113,500.

After two years, you’d have £128,822.

Impressively, you’d have overtaken your stock market earnings in just over four years, and after ten years you’d be sitting pretty on £354,780. Which makes those nerve-wracked stock market investors with their £170,000 look like dabbling amateurs.

As with shares, you don’t need a huge amount to get started. The minimum investment in a CapitalStackers scheme is just £5,000 – but many invest a lot more.

And considering you can access your capital by selling your investment on the secondary market, it’s no wonder more and more of the smart money is moving to loan-based property crowdfunding.

Find out more at www.capitalstackers.com or
by calling 
Steve Robson on 07774 718947
or Sylvia Bowden on 07464 806477
or Tony Goldrick on 07788 373126.


As the gurus at Motley Fool sound the death knell for Buy-To-Let, calling it an “expensive distraction” and point investors once more to the Stock Market, some more canny investors are sitting back and wondering if there is a third way.

After all, there are good reasons why we British have traditionally invested in property. And yet the FTSE also has very sound reasons to commend it.

But for those who want double digit returns but without the bumpy stock market ride, there is a way to achieve the benefits of both property investing and stock market investing in one, and reduce the drawbacks of both.

Secured on property, but more liquid than buying bricks and mortar – and less volatile than stocks and shares – it consistently brings higher returns than Buy-To-Let, without the overheads, management and conveyancing fees, refurbishment and maintenance costs and stamp duty.

Motley Fool suggests that in every respect other than the ability to borrow to invest, the Stock Market beats Buy-to-Let. And it surely does.

However, loan-based property crowdfunding has many of the advantages listed too. Investing in property developments through CapitalStackers, for instance, can bring you highly attractive risk weighted returns in the time it takes to build a row of houses. Investors in the Foss Place development in York made annualised returns of between 8.5% and 22.5% in just eight months – all within a sensible Loan to Value range of 58% – 75%. 

Like stocks and shares, you don’t have to have saved or borrowed huge sums to get started – you can participate in a building development scheme from just £5000.

And whilst your loan investment is as solid as the houses being built, it’s also more liquid. You can invest in a CapitalStackers scheme almost as quickly as you can buy shares (with the assurance that the due diligence has already been done for you) and if you want to free up your cash, you can sell part or all of your investment on their secondary market.

Although investing in Buy-To-Let is verboten for pension schemes, if you have a SSAS (or access to one) CapitalStackers gives you a route to invest in the same asset class by lending on residential property developments and take your gains free of tax.

But there’s one important advantage that investing through CapitalStackers has over the Stock Market, and it’s this: when you buy shares, you bear all the risk. If they drop in value, your capital gets burnt. There’s no firewall, no cushion, no contingency.

However, with CapitalStackers, even the highest risk layer is cushioned by the developer’s own equity and profit, and you get to choose yourself the level of risk you want to take and the corresponding rate of return.

All of which points to a very healthy alternative to both BTL and the markets. As Warren Buffet once said, “If you can’t invest in the stock market for ten years, don’t invest in it for ten minutes”, and of course, it’s difficult to make any money out of rental properties in the short term. But CapitalStackers can bring you attractive, typically double digit, returns in as little as 6-24 months. In short, as long as it takes the developer to finish a building.

Now, isn’t that worth considering?


How is stock market volatility affecting its value?

For decades, the UK stock market was seen as the standard way to make a steady return. Right up until the mid 1990s (October 1987’s Black Monday notwithstanding).

Since then, however, it’s been a rollercoaster ride, to say the least. With falls that make Black Monday look like a grey Tuesday.

So if your pension is invested in it (in common with the vast majority of the British public), then it could be costing you thousands of pounds right now. Which could, of course, seriously affect your cumulative total when you come to retire.

Because early suggestions show that 2016 is shaping up to be a bad year for British pension holders. In fact, some pensions funds may actually be falling in value.

This is largely due to China’s internal economic struggles having a knock-on effect on the rest of the world.

The graph below shows how much the FTSE has changed since 1984. If you’ve been following recent performance, heart in mouth, worried about the possibility of the next tumble, then isn’t it worth considering less capricious ways to invest your money?


How safe is your pension fund right now?


Start reviewing your pension before March 2016

Last year, we saw some serious changes to the way pensions work here in the UK. The most notable of which is the right to draw your full pension fund from the age of 55 – with 25% being tax-free.

However, not all of the changes will benefit all of us. In fact, with the government keen to squeeze us for every last penny, it’s widely expected that further changes will be announced in the March 2016 budget. Changes that are unlikely to make pensions any more attractive.

Let’s look at two of the most detrimental revisions from the 2015 budget:

  • Reducing the maximum that can be held in pensions without being liable for tax
  • Slashing the amount that can be saved in a pension for those who pay the highest tax

These two changes alone ought to be enough to make you take stock. Are your pensions really working as hard as they can?

So if you’re:

  • Frustrated watching your fund constantly rise and fall with the markets
  • Unable to predict what it may or may not be worth in the future
  • Unsure whether or not it will provide you with the retirement income you need

Then you should be seriously considering alternatives.

As part of your pension review, you should find out how it’s been performing over the last few years. If you find it’s not growing at least 5% (and realistically, a good deal more than that), you should seriously think about transferring to a SIPP – a pension plan that puts you in full control.


Swap to a SIPP

A SIPP is a self-invested pension plan, which enables you to select and manage how your pension is invested.

A SIPP enables you to place your pension through more innovative investment vehicles, such as the peer-to-peer property lending platform, CapitalStackers.


Why should you invest your pension through CapitalStackers?

Because CapitalStackers is focused entirely on real estate. The people and businesses you lend to on this platform will only ever be experienced property investors or property developers – and your funds are secured on their property assets.

What’s more, far from being an alternative to bank finance, it actually enables developers and investors to work with the banks, building on their support, so that investors can lend directly to pre-vetted borrowers and create a mutually-beneficial solution.

Now, although investing with CapitalStackers isn’t without risk, it does make understanding risk clear and simple, with no-nonsense, straight talking presentations that give you all the information you need. And it gives you the means to monitor your investments. You can even choose your preferred management team, location, property type and level of risk. And, if necessary, you can choose to exit your investment through our marketplace.

Best of all, by investing through your pension fund you don’t have to pay tax on the interest your CapitalStackers investment generates.


Final thoughts

So, whatever your stage of life, you should seriously consider investing through CapitalStackers via a SIPP. Where else can you choose your own risk and reward, and earn a tax-free return of between 5% and 20%? Click here if you want to know more.