To make your portfolio fully diversified you have to invest in Europe. A common misconception is that splitting your investments between stocks, bonds, real estate, and agriculture in the United States means you are diversified.
But this isn’t the case.
The reason why is simple. These markets are all intertwined, if one of them gets hit hard, they’ll all suffer. Even crypto, for a long time an investment unicorn has fallen in line. The price of Bitcoin has been correlated to Wall Street. The safest place to make an investment that really limits your exposure to the U.S. market, is in Europe.
The Old Continent is also home to many quality and some under-appreciated investments. Best of all, many of these investments come with a range of other benefits you simply won’t find anywhere else. In this article we will take a look at some of the best ways to invest in Europe, whatever your budget.
Real estate has been one of the safest and best performing European investments for more than four decades. With an ever-growing population, this trend is likely to continue for some time to come.
Investing in real estate in Europe has some nice advantages. The European real estate market has historically been a secure place to leave money over the long term. The market also tends to recover quickly from corrections. This is partly thanks to stricter lending regulations than in the United States.
Real estate in Europe offers different strategies to investors depending on how much risk they want to take. Buying an apartment in one of the major European cities like London, Paris, Milan or Lisbon is a rock solid place to park your cash long term. There’s a high chance of your investment increasing in value. The rental market in these big cities is also strong. You should be able to generate a reliable source of income this way. More than enough to cover your mortgage payments.
If you are looking for higher returns you can consider buying real estate in a developing European real estate market. Countries like Greece, Turkey and Croatia all offer affordable real estate that has the potential for big gains. Target vacation areas with solid infrastructure.
The biggest profits can come from investing in pre-construction apartments. In real estate, risk and reward are always closely linked. If you do decide to invest in pre-construction then be diligent in your research. Visit other projects built by the developer and find out if they were completed on schedule. Check how previously completed buildings are holding up and the quality of construction. If at all possible, speak with some of the current residents. They’ll tell you everything you need to know. If this research throws up any red flags you should walk away.
Real Estate With Residency Benefits
Some countries in Europe come with a major benefit that you won’t find in the United States market. The chance for European residency.
Perhaps the best option for this is Portugal. Their Golden Visa scheme allows investors the chance of European residency allowing you access to all 26 countries in the Schengen Area. Portugal offers a high standard of living to suit a variety of lifestyles.
Investors looking for a secure investment in a big city should consider a property in Lisbon or Porto. Lisbon’s real estate market has been one of the success stories of the past decade. It’s a global, historic city, with a thriving cultural scene. Porto is another good choice. A beautiful and slightly smaller port-town, real estate here is cheaper than in Lisbon.
If you prefer to be close to the beach or golf courses, then head to the Algarve. Portugal has more blue flag beaches than anywhere else in Europe and most of them can be found in the Algarve. Portugal’s Mediterranean climate means you can take advantage of the beaches from May until September. Surfers in wetsuits can be seen throughout the year, though. The Algarve is a golfers paradise, home to numerous courses. You can play throughout the year, with daytime temperatures in the Algarve seldom falling below 55, even in the winter.
To qualify for European residency through Portuguese real estate, you will need to spend somewhere between 280,000 to 500,000 Euros. The best deals are for older properties in low-density (countryside) areas.
Truffle Producing Trees
Investing in truffle producing trees is one of the best ways to truly diversify your portfolio and invest in Europe. Agricultural investments exist in a vacuum when compared to other investments. Mother nature will keep producing harvests irrespective of what’s happening in Wall Street or the latest economic policies.
Truffle producing trees are one of the best agricultural investments around. Unlike other forestry or agricultural investments, truffles are a premium product. Our black truffles, for example, sell for well over $1,000 per lb. This means that truffles are one of the few farming opportunities that doesn’t live on a razor thin margin. Most farmers make their money by selling a high volume of crop, albeit at a low margin. With truffles being so expensive, the margin is much greater. This allows investors to make healthy profits, on small parcels of land.
Truffle producing trees offer an annual income which investors can enjoy for three decades. Many truffle investors are benefiting from a reliable income stream well into retirement. Truffle producing trees are an investment that can be passed down to future generations. This type of steady, generational wealth is one of the reasons the world’s largest hedge funds always allocate a sizable part of their portfolios to agriculture.
A European ETF doesn’t offer quite the same upside as the two previous investments. But they do allow investors exposure to the European stock market. Investors can choose a basket of stocks from across Europe, or focus on a certain country or industry sector.
European real estate, and truffle producing trees are a more long term investment, but European ETFs can be a short term investment. These ETFs can be bought at the stock market, and are highly liquid. There is no lock in period for ETFS, this makes them popular with traders as well as investors. That said, there is nothing stopping you from holding ETFs over a longer period.
ETFs are pre-packed to offer investors exposure to a range of different securities. This provides some extra diversity to your portfolio, but not nearly as much as an investment in truffle producing trees or the European real estate market.
Invest in Europe to find the perfect way of securing your wealth while generating extra profits. There’s a reason why all the top investors recommend diversification. Thanks to the strong dollar, the time has never been better for U.S. citizens to invest in Europe.