Is Investing in FinTech Good for Your Portfolio?
Is Investing in Fintech Good for Your Portfolio?
FinTech is Financial Technology. When it comes to making money, there is no one-size-fits-all answer. What might be a great investment for one person may not be a wise decision for another. Everyone needs to do a little self analysis, ask yourself what external forces influence your decisions, do you commit to investments long term, or are you looking for flips, what is your internal risk meter, do you invest to learn, do you invest in things you believe in, and things you want to see change your daily life? We all have what they call Animal Spirits in finance let your instincts and self analysis guide you. Lately the major trend is financial technology, more and more people are asking about investing in fintech. So, is this a good move for your portfolio? An old adage comes to mind “The closer you are to the money, The more you make”, while this is not always true, it definitely trends.
Bold and innovative financial technology is changing how we do business. In February 2020, there were 8,775 Fintech startups in the USA compared to only 621 overall for all of 2019 the growth, and change in our old financial system is happening now and its accelerating. every industry faces moments of transformation, and it has been 40+ years since Finance has had a meaningful overhaul, and companies are moving fast to improve old less efficient systems. Fintech is a broad category that includes mobile payments, Lending, digital currencies like Bitcoin, other key applications of transaction utilizing blockchain, and even AI is becoming a part of the equation. This industry is growing at an incredible rate. According to a report by Goldman Sachs, fintech investment grew by 77% in 2018 and it has continued this pace to date.
Things to Consider
There are a few things to consider before investing in fintech. First, what are your investment goals? Are you looking to make a quick profit often limited, or are you more interested in long-term growth with a greater multiple return potential? Second, how much risk are you comfortable with? Fintech investments, like any, can be risky. If you’re thinking about investing in fintech, do your research to better understand the risks and potential rewards. Lastly, why are you investing; yes to make more money… but why do you choose a particular investment, what do you get out of that investment beyond potential return, do you have goals on top of this?
It is surprising how quickly a person can decide. extrapolating all of these questions makes it seem like a huge long process, but most people have these answers already, you just need to remind yourself of them, make them conscious again and act.
So, is fintech a good investment for your portfolio? Fintech is a rapidly growing industry with lots of promise and its about as close to the money as it gets. It could be a wise investment for your portfolio, diversification, adding growth potential, and always remember to balance the risks.
So What do I look for?
The first step for investors is to focus on the basics. What problem does this fintech firm want to solve? Does it offer customers something better and different than other products out there, does it fill any gaps or vacancies, and if so, how do they achieve this improvement, plus why is it important to you? The critical question shouldn’t just be what product will help me make money, but also why I should choose them over their competitors, if they have any within their niche.
Investors should become familiar with the management team. Do they have the right mix of experience and knowledge, are they backed by a key advisors etc…? How well do they know their customers? are they communicating to their users and improving or developing with customer feedback? What is their go-to-market strategy? Where do you fit in? Again you likely have many of these answers instinctually, but its always important to remember them.
Financial technology companies are transforming the financial industry by offering better access to funding, increased efficiency, increased optionality or user control, greater exposure and liquidity, more transparency, and customer retention. These innovations have helped them manage risk more effectively, a key advantage over legacy institutions depending on the Fintech’s target product and offerings.
One such company, offering an innovative approach to investing is Acquire.
Through their mobile investment app and trading platform, Acquire Simplifies and opens up private placement and alternative asset investing to every level of investor; regardless of the investors level, with this approach Acquire is set to redefine personal investing.
Acquire allows users to trade a wide range of assets that previously were not available to retail investors and assets that lacked a secondary market for both accredited and retail investors to take advantage of. They are also one of the only platforms for this asset class that offer fractional share trading, making it possible for investors to buy a portion of an expensive asset or investment interest wit a low entry point. invest with USD, or several key crypto currencies. What’s more, following their invite only Beta launch, that you can get into, they will be launching new social features in 2023 with their main app launch. This key social investing feature lets users track the portfolios of other registered investment advisors, and mimic their trades.
Acquire is changing the game, and leveling the playing field by making it possible for anyone to start investing without breaking the bank. If you’re looking to invest in fintech, Acquire is a great option to consider. Their mobile app and trading platform make it easy and affordable. Their new social features let you connect with other investors and learn from a community of investors.
Currently Acquire is seeking users to add crucial product feedback in the beta phase of its app.
Acquire has launched an equity crowdfunding campaign on Wefunder for its future users to become shareholders in the app. Information can be found here.
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