Investments that Provide a 10 Percent Annual Return
Is it possible to find investments that provide a 10 percent annual return? Yes—and where to find them might shock you.
Investing is often seen as one of those situations where you have to risk it all to make a lot of money. Truth be told, it's not always that far off. Most high-risk investments have high payoffs, while low-risk investments won't crack past a 4 percent annual return on a good year.
Low risk investing is generally seen as a good move—even in the stock market. That being said, most people want at least one or two "power hitters" while they prep their portfolios. A high-yield investment, generally speaking, would involve investments that provide a 10 percent annual return on average.
We decided to look at that highest-yield investments we could find. Here's what we found...
If you were present during the Bitcoin boom, then you are already aware that cryptocurrencies can be investments that provide a 10 percent annual return on a typical year. Returns on currencies like Bitcoin have been astronomical, with some seeing a 1000 percent return in a single year alone.
That being said, the chances of losing it all are also pretty high. There's a reason why they're considered to be the most dangerous investments you can make, you know!
High Yield ETFs
Love the stock market? Then you might want to look into buying some high yield ETFs. Charts that show the highest-performing ETFs have shown that it's very possible to see 30 percent returns or more over the course of a decade. You just need to pick the right ones.
If you want something safe that still ranks among investments that provide a 10 percent annual return or more, we suggest looking at the best S&P 500 index funds. It's a good way to see a return of 12 percent or more without risking it all.
Traditional Real Estate
A person who has a lot of home savvy might be able to score some pretty good returns by investing in real estate. Buying the right buildings and flipping them can easily lead to profits as high as 80 percent or more.
That being said, this isn't the kind of investment that anyone can really do. It takes a lot of work to be a landlord, and even flipping homes can prove to require way more connections that most are willing to make.
It's hard to invest in real estate without money, but it's not impossible. The stable income it can provide, though, definitely makes it a worthwhile endeavor if you've got what it takes.
REITS, also known as Real Estate Investment Trusts, are a better option for people who love the returns of real estate but hate all the hard work that real estate requires. These are managed trusts that allow you to invest in real estate projects that are managed and worked on by other people.
As far as REITS go, they definitely are investments that provide 10 percent annual returns or more—assuming you choose a high-quality one, anyway. It's an easier way to invest in housing.
Like with traditional real estate investments, REITs have high startup costs. However, if you have $5000 in the bank that you're willing to free up, this could be a great move.
When most people think of the word "artist," they tend to think of the broke barista at the local Starbucks. Believe it or not, art can pay off. In fact, it's one of the most well-established investments that can provide 10 percent annual returns on a regular basis.
The fine art that yields the highest returns are the ones that become household names, such as Rembrandt or Pino. If you can get your paws on works by the masters, you can expect your annual return to skyrocket to as much as 100 percent per year!
You don't even have to be wealthy to invest in fine art. Sites like Masterworks.io allow you to buy shares of a multimillion-dollar fine art painting for as low as $20.
Starting Your Own Business
A friend of mine was broke, but he bought a simple push lawnmower for about 15 dollars. It was a rickety old thing. However, with that thing, he went door to door asking to mow people's lawns for 30 bucks. He made back his investment in a day.
Entrepreneurialism, if done right, can be a great investment. However, it'll be up to you to actually make it work. Your work ethic and luck will be what determine returns on your investments made towards your business.
Short-term stock trading might be a good way to improve your total returns for a year. Day trading and other similar forms of short-term trading that involve capitalizing on market fluctuations can easily be investments that provide 10 percent annual returns.
That being said, this requires a lot of research and knowledge. In most cases, this is not really a feasible method of making money unless day trading is your main job.
Remember when we talked about how high risk investments tend to be the ones that tend to be more profitable? This is a good example of one, and in theory, it's one of the investments that provide a 10 percent annual return when done right.
This investment form allows you to help crowdfund loans that applicants want to take out via third-party platforms like LendingClub or Prosper. As the borrowers pay you back, you get to keep the interest.
Sites are supposed to vet applicants, but in reality, most applicants don't really give much aside from their credit score and income. This, in turn, makes it risky since most loans won't be backed by collateral.
There are people out there who have seen 12 percent annual interest rates through lending. However, increased default rates have led to most people seeing higher returns around the 6 to 7 percent mark.
High-Yield Dividend Stocks
If you are just starting to invest in the stock market, then you already need to know about dividends. Dividends are small cash payouts that some stocks give as a way to thank investors for giving them cash.
High-yield dividend stocks, such as Boeing or Verizon, have seen massive growths. When you factor in the amount of money that you get from dividends, many dividend-rich stock investments are capable of yielding a 10 percent annual return on average.
Angel Investing/Private Investing
You might enjoy investing in stocks, but if you have a lot of cash, why not go the private route? If you are willing to accept the risk and become a venture capitalist, you might be able to get on the ground floor of the next Facebook.
Though these are investments that provide a 10 percent annual return from time to time, the truth is that they are very high-risk. So, try it once you learn how to navigate the investing world a little bit better.