Affluent Savvy
Photo by cottonbro studio Pexels Logo Photo: cottonbro studio

What do most billionaires invest in?

Securities Funds and stocks are the bread-and-butter of investment portfolios. Billionaires use these investments to ensure their money grows steadily. Billionaires typically hold onto these investments, instead of trying to time the market for a quick buck.

finance.yahoo.com - This Is Where Billionaires Keep Their Money - Yahoo Finance
Who has the highest credit score?
Who has the highest credit score?

For most credit-scoring models, including VantageScore 3.0 and FICO, the highest credit score possible is 850. We were able to speak to two...

Read More »
Last updated Dec 2, 2021
Is 30k a year good for a single person?
Is 30k a year good for a single person?

Is $30,000 a Good Salary for a Single Person? No, $30,000 is not a great salary for a single person, but it can be livable depending on the...

Read More »
Last updated Jan 13, 2018
Awaken your dormant DNA ability to attract wealth effortlessly
Awaken your dormant DNA ability to attract wealth effortlessly

The simple yet scientifically proven Wealth DNA method laid out in the report allows you to effortlessly start attracting the wealth and abundance you deserve.

Learn More »
Promotion

where do billionaires keep their money

Billionaires have been able to not only acquire wealth but most have gradually built it over time. This means that many have had successful investments, which makes it natural for everyone else to wonder where they are investing or keeping their money in order to see that growth. We’ve compiled a list of some of the most common investments that billionaires make when looking for sustained growth of their money over time. Keep in mind, though, that billionaires don’t typically manage their own money and instead choose to work with a financial advisor to help with their asset allocation.

1. Cash and Cash Equivalents

Cash and cash equivalents are common places where billionaires keep of some their money. Though not often thought of as an investment, cash is a liquid asset, meaning you can use it in a variety of ways as needs or desires arise. In a crisis, having cash on hand gives you the flexibility to respond. That’s why billionaires keep a significant portion of their money in cash and cash equivalents. However, with current rates of inflation, cash has less of an emphasis. Inflation causes the value of money to drop, so having too much of it on hand during an inflationary period can mean you lose significantly.

2. Commodities

Commodities are often another piece of a billionaire’s portfolio, and having such assets can help hedge against risk, inflation and volatility. For instance, in a scenario where inflation is causing difficulty for the rest of the market, having investments in raw materials whose price is rising can help protect you if other parts of your portfolio are suffering. People and economies depend on commodities, and inflation makes them worth more money. Raw materials and agricultural products – like precious metals, industrial metals like copper, oil and natural gas, coffee, corn, pork bellies and soy beans – are popular types of commodities held and traded by billionaires or their agents.

3. Foreign Currencies

Holding foreign currencies offers billionaires the potential to capitalize on fluctuations of value in various currencies. It is simply a form of diversification: Rather than have all their assets denominated in one currency, they spread some of their wealth to assets denominated in other currencies. That offers protection against one currency falling and capital appreciation if another currency in which they have assets gains value.

Story continues

4. Securities

Another common place where billionaires keep their money is in securities. Securities are financial investments and instruments with some value that can be traded, oftentimes on public markets. Common types of securities include bonds, stocks and funds (mutual and exchange-traded). Funds and stocks are the bread-and-butter of investment portfolios. Billionaires use these investments to ensure their money grows steadily. Billionaires typically hold onto these investments, instead of trying to time the market for a quick buck. That means they’re relying on the long-term upward growth of the market to give them a return.

What jobs won t exist in 10 years?
What jobs won t exist in 10 years?

10 Disappearing Jobs That Won't Exist in 10 Years: Professions That Won't Guarantee Career Opportunities Retail Cashier: $21,000. ... Telemarketer:...

Read More »
Last updated Jun 1, 2022
What happens if you meditate too long?
What happens if you meditate too long?

Meditation lets you be in tune with your thoughts and emotions. And while this is generally a good thing, over-meditation can lead you to be...

Read More »
Last updated Apr 20, 2021
Awaken your dormant DNA ability to attract wealth effortlessly
Awaken your dormant DNA ability to attract wealth effortlessly

The simple yet scientifically proven Wealth DNA method laid out in the report allows you to effortlessly start attracting the wealth and abundance you deserve.

Learn More »
Promotion

5. Private Equity and Hedge Funds

where do billionaires keep their money

Private equity and hedge funds sit adjacent to securities and trading markets. While they aren’t the same thing, these two types of investment tools are popular among billionaires. They appeal to people of high net worth who can afford large investments and higher risk. Such people are sometimes categorized as sophisticated investors or accredited investors. Hedge funds use large pools of money and strategic investments in a variety of assets to generate high returns. Private equity, on the other hand, trades in privately owned businesses with the goal of running the business for higher profits. Both require a significant amount of money to participate, keeping them from being an option for many investors.

6. Real Estate

It should come as no surprise that one place billionaires keep their money is in real estate. One of the most common ways to invest in real estate without worrying about constant maintenance is to put your money into real estate investment trusts (REITs). This can provide you with a strong return while someone else manages the investments and management of the physical properties. Commercial, industrial and residential property investments can also offer a steady stream of income from tenants. Of course, owning real estate is great when its value is growing, but what about other reasons? Another advantage of owning real estate is taxes. For instance, if your property depreciates, it’s deductible from your taxes.

7. Collectibles

When billionaires are looking for places beyond traditional investments to keep their money, they might turn to tangible, collectible investments. These often include pricey collectible items, like vintage cars, fine art and rare or antique musical instruments and original manuscripts of famous books. While all successful investing requires research, it’s especially true for collectibles. The investor needs both an interest in the items, but also a discerning eye and the ability to not become immediately emotionally invested.

8. Cryptocurrencies

Cryptocurrencies – like Bitcoin, Dogecoin and Ethereum – are volatile and intimidating to many, including billionaires, but some billionaires have chosen to invest in them. The truth is digital currencies are growing in legitimacy and value. Cryptocurrency – and the blockchain it’s built on – is a revolutionary technology that could change many industries. Part of the appeal of crypto for billionaires is that it allows for a secure store of value. Due to cryptography, the money can’t be taxed, stolen or confiscated. It’s also apolitical and free of government oversight. Plus, it can be used globally without worrying about shifting exchange rates.

Can I afford a 400K house on 100K salary?
Can I afford a 400K house on 100K salary?

A $100K salary puts you in a good position to buy a home With a $100,000 salary, you have a shot at a great home buying budget — likely in the...

Read More »
Last updated May 22, 2019
How can I sharpen my brain everyday?
How can I sharpen my brain everyday?

13 Brain Exercises to Help Keep You Mentally Sharp Try puzzles. Play cards. Build vocabulary. Dance. Use your senses. Learn a new skill. Teach a...

Read More »
Last updated Dec 2, 2019
Awaken your dormant DNA ability to attract wealth effortlessly
Awaken your dormant DNA ability to attract wealth effortlessly

The simple yet scientifically proven Wealth DNA method laid out in the report allows you to effortlessly start attracting the wealth and abundance you deserve.

Learn More »
Promotion

Of course, cryptocurrencies are still unpredictable and have yet to gain widespread use. That keeps some billionaires from investing, but others see crypto as another opportunity to grow their wealth, or at least protect it from taxation. These currencies also make it easy to move money or pay for things in other countries.

The Bottom Line

where do billionaires keep their money

You may not be a billionaire, but you can still see how they make their money work for them. By learning where billionaires keep their money, you can pursue some of these investment types yourself in order to grow your own wealth. Cash stored in savings and investments in a diverse portfolio of securities and commodities is a good starting place, but the more wealth you acquire the more you can invest in more aggressive opportunities. Billionaires didn’t become rich without help, so there’s no reason you should struggle alone. You can work with an experienced financial advisor to help you create a financial plan and allocate your assets correctly. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now. If you’re ready to know your investments better, one step you can take is calculating your rate of return. See how the growth of your investments over time will affect how much return you see. Check out SmartAsset’s investment calculator to get started.

©iStock.com/Extreme-Photographer, ©iStock.com/William_Potter, ©iStock.com/guvendemir

The post Where Do Billionaires Keep Their Money? appeared first on SmartAsset Blog.

finance.yahoo.com - This Is Where Billionaires Keep Their Money - Yahoo Finance
What plant brings money?
What plant brings money?

2) The Rubber Plant (Ficus Elastica) The Rubber tree plant is one of the many types of indoor ficus trees. The Ficus Elastica has round leaves,...

Read More »
Last updated Apr 3, 2020
What to pack if you're spending the night with a guy?
What to pack if you're spending the night with a guy?

Don't Forget to Pack These Overnight Essentials for a Sleepover at His Place Toothbrush. ... Make up removal wipes. ... Clean underwear. ... Clean...

Read More »
Last updated Nov 20, 2021
Awaken your dormant DNA ability to attract wealth effortlessly
Awaken your dormant DNA ability to attract wealth effortlessly

The simple yet scientifically proven Wealth DNA method laid out in the report allows you to effortlessly start attracting the wealth and abundance you deserve.

Learn More »
Promotion
How long can a 2 year old remember someone?
How long can a 2 year old remember someone?

In these studies, almost all researchers concluded toddlers are able to retain memories several months and perhaps years after an event occurred....

Read More »
Last updated Dec 27, 2019
Awaken your dormant DNA ability to attract wealth effortlessly
Awaken your dormant DNA ability to attract wealth effortlessly

The simple yet scientifically proven Wealth DNA method laid out in the report allows you to effortlessly start attracting the wealth and abundance you deserve.

Learn More »
Promotion
What is first sin?
What is first sin?

Traditionally, the origin has been ascribed to the sin of the first man, Adam, who disobeyed God in eating the forbidden fruit (of knowledge of...

Read More »
Last updated Sep 3, 2022