Investing is a complicated thing. It will take time to understand everything fully but basically, it is the purchase of goods with the goal of generating wealth in the future. Many people consider it because of the potential of receiving more money later. There are many types of investment but stocks and bonds are the most popular.
You have to know though that many investors these days diversify their portfolio when it comes to investing. Diversifying is a good way to minimise market volatility. With this, many investors consider alternative investments these days. Alternative investments are non-traditional investments that fall outside stocks, bonds or cash.
There are many examples of alternative investment like precious metals (gold, silver platinum, aluminum, copper, nickel, cobalt and palladium), commodities (natural gas, crude oil, ethanol, sugar, soy, wheat, coffee and oats), timberland, intellectual property rights, arts and collectibles, wine and shipping containers. If you wonder what is the best investment, it is time to think about investing in shipping containers. Here’s why you should consider it:
Shipping is a big business
Shipping container investment involves purchasing containers. You get money by leasing it to shipping companies. Shipping business is a big business considering that most of the world’s products are transported through it. Shipping is also one of the most cost-effective ways of transporting products or goods from one point to another. Since it is a big business, it presents investors with significant return potential.
There are brokers that can assist you
Since shipping is a big business, things can get confusing especially if you try to find shipping companies on your own. This is where brokers come into the picture. Brokers like Davenport Laroche can assist investors by locating and contracting with shipping companies. Basically, the agency will connect the investors to shipping companies and other merchants.
It is a monthly cash flow
As long as there are companies shipping goods globally, shipping containers will always have intrinsic value. With this, you are sure to receive monthly cash flow. The lifespan of shipping containers is 20 years and they are low maintenance. If you want, you can also sell them. The residual value is strong because of its high nickel content. Whatever you consider, it is a win-win.
The liberalisation of the world market
You have to know that the liberalisation of the world market contributed to its high demand. Liberalisation of trade is the reduction or removal of restrictions on the free exchange of goods between countries. An example is the reduction or removal of a tariff. With this, many goods freely move from one point to another. Shipping containers come into the picture because it is the most preferred method of transportation of goods.
It is given favorable tax treatment
Alternative investments are subject to favorable tax treatment compared to traditional investment. In traditional investment, every dollar generated has significant tax credits.
Before you finally indulge, you should be aware of the risks. Like any investments, shipping containers are risky. Even if the investors sign multi-year lease contracts, shipping companies can go bankrupt. The thing is, returns are not guaranteed and depend on the shipping industry.