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 Equity Crowdfunding, Everybody can invest in private equity

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SUSrobertchoo
post Nov 4 2015, 04:41 PM

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QUOTE(prody @ Sep 30 2015, 04:31 PM)
I can see these risks for crowdfunding a relatively new company that mainly invests in overseas companies:
1 Risk that the company is more of a scam than an actual investment company (since they have no long track record, there are many scams around)
2 Risk that the investments they make are no good (since they have no long track record)
3 Currency risk (if the currency of the country they invest in appreciates compared to the Ringgit)
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One more thing to note is that equity crowdfunding may or may not (usually may not) have a tenor. That means you can't sell your portion of equity until the company is listed or until you can find another person to take over from you. Because borrowers are mainly SMEs, it takes a very long time for them to be either listed or can be sold to someone else. So buyer beware! There also no saying that the company won't go bankrupt not from fraud but just bad management or internal/external economic issues.

That is why some people prefer crowd lending instead or peer to peer lending. At least there is a tenor and your returns are fixed.
SUSrobertchoo
post Nov 4 2015, 08:25 PM

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QUOTE(Hansel @ Nov 4 2015, 08:13 PM)
Yes,... there is body called Funding Societies in Sgp that provides peer-to-peer lending services in Sgp. Given the better regulation in Sgp, would this reduce the systemic risks associated with such investments ?

Following is a write-up forwarded to me last week by an associate who is into this. He invested only SGD100 earlier during the promo period for investors, whereby he was allowed to invest only SGD100. Today, the minimum sum is SGD1K to start with.

To introduce us, we are Funding Societies, one of the first peer to peer lending companies in Singapore. We bring SME borrowers and Investors together for their funding and investment requirements. We provide business loans to SMEs through crowdfunding by multiple investors. Investors earn high returns up to 14% per annum.

A few of our accomplishments in recent times :

•First P2P Lender to have an escrow account managed by MAS licensed trustee. This ensures that the Investor funds are managed only by the Trustee and not Funding Societies

•First P2P Lender to introduce e-contracts (no physical signatures required, everything done online, and its a very simple yet compliant way of executing contracts)

•Finalist of Maybank Fintech competition and chosen by Maybank for partnership

•Winner of Tech in Asia for the best start-up (Singapore chapter)

•Featured in Business Times, Channel News Asia, BBC, Vulcan Post, Crowd Fund Insider etc

For investors it provides :

•A new unique investment proposition

•Diversification opportunity

•High returns at minimal risk

•Low capital requirement (Minimum investment of just $1000)

Link here : Website: http://www.fundingsocieties.com/

Anybody keen on this ?
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Well, personally i would think yes, it does. Singapore has a much more stable and transparent regulations compared to Malaysia. But at the end of the day, its still depends on your risk appetite and your ability to understand the numbers driving the businesses.
SUSrobertchoo
post Nov 5 2015, 10:36 AM

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QUOTE(prody @ Nov 5 2015, 09:27 AM)
Yeah, lots of risks in this type of new and mostly unregulated investment class.
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high risk high returns. there are no asset class that can generate above 10% returns in 12 months. the key is to research research research. know what you're doing.

if you are looking for very low risk asset class try bank FDs.

This post has been edited by robertchoo: Nov 5 2015, 10:37 AM
SUSrobertchoo
post Nov 5 2015, 06:34 PM

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QUOTE(prody @ Nov 5 2015, 11:34 AM)
Actually there are asset classes which can do this. You just need to be very good at it or lucky all the time.  biggrin.gif

FD's certainly are good if you don't like stress.
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such as? i've not seen any asset class that can gain you 10% in a years time that do not involve significant higher risk

 

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