Why invest
WHY INVEST...
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The current inflation rate in Slovakia is the highest in the last 15 years and is likely to exceed 10 percent in 2022,
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interest rates on bank accounts are also rising, but at a much slower speed,
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investing free funds into assets with a stable but solid revenue is the only way to prevent the savings from losing their value.
...IN PROPERTY...
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Unlike the vast majority of other assets, real estate keeps retaining its value in the long run.
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the price of property is growing steadily, thus offsetting inflation.
...IN THE ALPS?
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The value of Alpine property is constantly increasing - and this is doubly true for ski in&out apartments located right next to the slopes.
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By purchasing property in Austria, you will invest in a developed country with stable legislation, upholding the rule of law.
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Making an investing in Euro can protect part of your property from fluctuations of other currencies.
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In ski resorts based in lower parts of Europe, lack of snow leaving the hotels and apartments empty is an ever-present risk. In the Alps – thankfully - the snow scarcity in the ski resorts is not a serious issue so far.
Saving account
Cryptocurrencies
Gold
Corporate bonds
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Current accounts with negative interest rates and savings accounts with interest rates just above zero are probably gone.
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Central banks fight inflation by raising interest rates, as a result of which interest rates on bank accounts rise as well.
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However, the level of the interest rates will in no case reach the expected level of inflation.
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Thus, savings kept at a bank account will lose their value continuously.
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Investment gold is one of the reliable and low-risk commodities with high liquidity.
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However, the price of gold is highly dependent on many factors - including the development of the value of the US dollar.
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In the past, the price of gold fell sharply several times: it lost 40% of its value between 2011 and 2016, and fell sharply in 2020 as well.
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In addition, holding gold does not generate any ongoing income typical of shares (dividends) or investment property (rentals).
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All of the above applies to other precious metals, such as silver, platinum, etc.
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Cryptocurrency prices are on a roller coaster - the value of an investment can rise or fall by tens of percent in a single week.
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The price of bitcoin increased six times during 2020 to fall by a third the following year. Since the beginning of 2021, price developments have been even less prevalent - the cryptocurrency market has no experience with high inflation and the question of whether bitcoin or ethereum can play a role in protecting against savings is not yet answered.
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In addition, it is clear that the cryptocurrency market will be regulated in both the US and Europe in the near future.
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Due to the price volatility, investment advisers almost unanimously recommend that investment in cryptocurrencies should not exceed 5-7% of the total investment portfolio.
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Bonds issued by private companies are a very risky investment instrument.
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They usually offer above-standard gains, but are not secured or regulated in any way.
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in other words – private bonds are an equivalent of an unsecured loan that may never be returned to the investor, as has been shown in many cases in practice.