GRIP INVEST.... Have you heard about this 🤔

*GRIP INVEST.... Have you heard about this 🤔*

If Equity market is an absolute NO NO to you and still you are looking for an alternative source to earn your passive income which may beat inflation then you can have a look at this avenue called GRIP INVEST...

Here is how GripInvest works:

Imagine a company needs some equipment for their business. But they either don’t have, or don’t wish to make a huge capital expenditure.

*This is where GripInvest comes into the picture.* GripInvest will collect money from investors like us or thtough  crowdfunding. They will purchase this inventory, and lease it to the said companies. 

*The rent received is distributed back to us*. 

The *company saves money upfront*. 

Investors earn returns in the form of rent. 

This is not linked to the stock market, and thus provides good diversification. 

GripInvest earns a commission for facilitating the entire procedure.

Drawbacks:

The following are few drawback that i could assimilate...

1. There is no liquidity. The payment schedule is given to you upfront. Not much you can do if you need more money ahead of this schedule.

2. Don’t forget concentration risk. Despite all the measures taken to avoid defaults, your entire returns are dependent on a single company not defaulting on its payments. Thus, Grip is not an alternate to FDs or debt mutual funds. 

3. I found their customer care hard to reach.

4. We are accustomed to looking at CAGR for judging investment returns. Grip mentions IRR, which is a more accurate measure for investments with periodic returns or investments. IRR will always be numerically higher. This can mislead investors. However, I do not blame them for this. Like any other company, they using the best possible language for their marketing. Also, their FAQs and blogs explain the difference quite well.

5. The real risk for the investor comes if two events take place simultaneously: 

a. The borrowing company defaults on its payments. 

b. The asset they had borrowed cannot be sold at a good enough price to aptly pay the investors.

For more details do browse the net...

*Happy Investing😊*