We often hear about unexperienced investors who tried to manage their own investments and ended up losing everything. Your money is hard-earned and shouldn’t be gambled away by someone who doesn’t know what they’re doing. It makes more sense for the average person to outsource the management of their financial products. Here’s why.
Individual investor performance is low
Studies show that when people invest their money without the guidance of a manager, their performance is disappointing. Without the proper understand of markets and investment tools, an individual can’t hope to choose the right investments. In the real estate industry, our ability to pick profitable properties is a result of years of experience and thorough investigation.
Individual investors tend to invest with their emotions
Investing is not about gut-feelings or hunches. It’s about sound research and careful valuation of each potential investment. Individual investors have the habit of buying into investments because it sounds interesting, or because their brother-in-law really recommended it. You need someone who is going to make decisions based on cold logic and reason.
Individual investors usually fail to diversify enough
Dumping your entire life’s savings into a single investment is a quick way to lose a lot of money. A single dip in the market can set you back years. A financial manager knows that one’s money must be spread out among a myriad of opportunities in order to keep it safe. That’s why we like to get our partners involved in many of our properties, to insulate them from catastrophe.
Individual investors rarely have the time it takes
We work full time (and then some) to make sure the investment opportunities we present to our partners are carefully vetted and ready to make money. You probably don’t have that kind of time. After all, you have a job or business that puts food on your family’s table and puts funds into your retirement accounts. It would be very difficult for you to commit the hours necessary to succeed.
Individual investors have better ways to spend their time
In terms of your finances, you have much better ways you could spending your time. Rather than spend the hours needed to understand markets and evaluate investments, it makes more sense for you to put that energy into earning more. Those extra earnings can be added to your growing accounts and further exploit compound interest. For the same reason it’s practical to outsource your healthcare and legal advice, so should you outsource your investment advice. Simply, your time is more valuable. If you enjoy the investment world give us a call and we would love to chat with you more about your views and opinions.
Written by Mark A. Mascia, President and CEO of Mascia Development
Mark manages the investment and operating activities of Mascia Development, a diversified value real estate investment firm that acquires, owns and manages retail, medical office, family offices, multi-family, and industrial real estate properties in the most promising long term growth areas nationwide. Through crowdfunding, they create powerful real estate opportunities for high net worth individuals.
A fully integrated real estate company, Mascia Development has in-house capabilities in acquisitions, financing, re-development, and construction; and their principals have experience in property and portfolio management, leasing, and maintenance.
Mark has a strong career in real estate, previously managing a property of portfolios valued over $1.1 billion. Mark has worked at Archstone-Smith (a former publicly traded REIT) and Monument Realty, one of the largest office real estate developers in the Washington, DC metro area. Mark teaches real estate development and finance at New York University.
For more information, visit www.masicadev.com.
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