Yieldstreet Review 2023
|By: Jeremy Biberdorf||March 6, 2022|
In a nutshell: Yieldstreet is the crowdfunding investment platform empowering people to put their money into alternative investment assets, such as commercial real estate, marine investments, and artwork.
If you’re looking to diversify your portfolio, our Yieldstreet review shows it could be an option well worth examining.
|0-2% annual management fee||$10,000||Get a free account|
- Access to a diverse array of alternative investments
- Opportunities for high returns
- Regular dividend payouts
- High investment minimums
- Risky assets
Compare to Other Investment Platforms
Fees0-2% annual management fee
FeesBetween .5% and 1.5%, depending on investment type
Yieldstreet Review Introduction
Yieldstreet is an option for investors who want to diversify. If you’re looking to invest in riskier assets with the prospect of high returns, this is the platform that gives you access to them. You’re investing in the debt instruments behind alternative investment assets, so remember that you are essentially lending your money.
Note that Yieldstreet is not aimed at investors with a small amount of capital. The ideal investor is someone who already has a six-figure portfolio and wants to diversify beyond what they can do with an ordinary brokerage.
Find out more about how Yieldstreet works with the help of Modest Money. Read through our Yieldstreet review to decide if this is a platform worth pursuing.
What is Yieldstreet?
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Yieldstreet was founded in 2014 in New York City by Milind Mehere and Michael Weisz. Mehere boasts a lot of experience in starting companies, as he was one of the founders of Yodle. Since 2014, the company has gone from strength to strength in acquiring other companies in various sectors, including within the art world.
Previously, the platform was open exclusively to accredited investors, freezing out most people. Yieldstreet has made changes and expects to welcome more non-accredited investors in the near future.
While these investments represent a chance to make serious gains, their alternative nature means that this is not the platform for novices. An intimate understanding of the markets is required to invest in these sectors.
How Does Yieldstreet Work?
We believe that Yieldstreet is an opportunity to get into investments that were previously inaccessible to all but the wealthiest Americans. The crowdfunded nature of these investments opens up chances to diversify your portfolio in ways never thought possible.
Here’s what you need to know about how Yieldstreet works.
The company claims that the minimum investment is $10,000. Realistically, investment minimums are significantly higher than this. Some past deals have reportedly required a minimum investment of $60,000 to get involved.
However, if investing in the Prism Fund or a short-term note, minimum investments begin at just $500.
Yieldstreet secured debt investments on several asset categories, such as marine, art, litigation, and real estate. You’ll find every investment offering on the company’s website with all the necessary details.
One advantage of the platform is that they’re incredibly transparent regarding how long an investment is expected to run and the expected annual return. Furthermore, when you invest with Yieldstreet, you receive a full breakdown of why the company believes a specific investment can be profitable.
They offer their whole reasoning behind why they have decided to feature an opportunity on their website.
The Yieldstreet Investment Process
All investments on the site are backed by an underlying asset of some kind, such as a piece of real estate, a boat, or even a legal settlement. Even when loans go into default, the company still has a way of recovering its money.
Like any investment, there are no guaranteed returns. You will need to accept taking on considerable risk if you decide to create an account with Yieldstreet.
Understand that you’re not taking a share of any of these assets. You’re lending money and making a return on the yields paid by the borrower on these assets. The platform takes a fee from its investors for managing loans, collecting payments, and distributing returns to its investors.
Your investment is a crowdfunded loan to the asset owner, and it’s the asset that secures the debt.
Yieldstreet charges anywhere from 0% to 2% in management fees yearly. Only its short-term notes don’t carry any fees. Before you invest in a particular deal, Yieldstreet publishes its fees clearly so you can decide if it’s worth it to you.
The borrower pays the fees on the investment rather than the investor. In other words, if a borrower fails to pay, Yieldstreet experiences the same pain as the investor.
Investors pay an annual fee based on the structure of the loan. A Special Purpose Vehicle invites a $100 yearly charge, whereas a Borrower Payment Dependent Note charges $150. These fees only apply to the first year. Subsequent years see these fees decline to $70 and $30 respectively.
If investing in any of the platform’s funds, such as the Yieldstreet Prism Fund, you’ll pay a 1% management fee and administrative expenses of 0.5% or less.
Is Yieldstreet Right for You?
Yieldstreet is a great alternative investment platform for people who want to go beyond the services offered by a traditional brokerage. However, the high account minimums and the need to be accredited for many deals means these investments are reserved for those with large, established portfolios.
Other than that, it’s a legit company that has proven itself as a profitable proposition. If you’re searching for a high-yield investment, Yieldstreet could be the platform for you.
Create a free account with Yieldstreet to start investing now.
Frequently Asked Questions
Yieldstreet does have a long history of success. More than $1.3 billion has been invested in the site, with almost $750 million in profits returned to investors. Its net IRR is a tremendous 11.54%, as it stands.
Like most crowdfunded investments, you’re required to hold for the duration of the investment. If an investment duration is two years, you must stay in for two years. These investments are long-term commitments and cannot be day traded like stocks.
The only risk to investors is the borrower defaulting on a loan. It has happened before, but due to all investments being backed by an underlying asset, the company does have ways of recouping investor money.