Investments

 

 

LEARN THE BASICS OF STOCKS, MUTUAL FUNDS, ANNUITIES, AND FIXED-INCOME INVESTMENTS.

It is tempting to try to time the market or invest in the hot stock of the day but believing in a long-term, diversified investment strategy is a much more solid way to help you reach your goals. After all, JLP Investments has been helping people – many like you – do just that for years.

Take a look at some of the ways the office of JLP Investments might help you achieve your many financial goals:

ALTERNATIVE INVESTMENTS

REITS

What is a REIT / Nonlisted REIT?

A: REITs pool the capital of many investors to indirectly invest in a professionally managed commercial real estate portfolio. REITs must pay distributions to stockholders equal to at least 90% of “REIT taxable income,” subject to certain adjustments. REITs are not typically subject to federal corporate income taxes, thus eliminating the “double taxation” (taxation at both corporate and stockholder levels) generally applicable to a corporation. REITs are considered an option for generating income.

A nonlisted REIT has all of the above characteristics but its shares are not listed on a public exchange. A nonlisted REIT is focused on buying and managing new assets purchased in the private real estate market. Eventually, as part of its lifecycle, a nonlisted REIT may list on an exchange or may merge with or be sold to another traded REIT. However, nonlisted REITs do not offer the liquidity of listed REITs and there is no assurance that a nonlisted REIT will have a liquidity event. Investors in nonlisted REITs generally are seeking income from distributions over a period of years. Listed and nonlisted REITs are registered with and regulated by the SEC.

Investors should bear in mind that investing in the shares of a nonlisted REIT differs from investing in listed securities in significant ways. Shares of a nonlisted REIT have limited liquidity. In contrast, an investment in a listed company is a liquid investment, as shares can be sold on an exchange at any time. Investing in shares of a nonlisted REIT also differs from investing directly in real estate including the expenses related to a nonlisted REIT offering and other fees and expenses that the issuer may pay.

There is no guarantee that a liquidity event will occur.

REIT Life Cycle

REIT Life Cycle

Potential Liquidity Event Process

Potential Liquidity Event Process

There is no guarantee that a liquidity event will occur

BDC

 

EXCHANGE-TRADED FUNDS

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PASSIVELY MANAGED EXCHANGE-TRADED FUNDS DESCRIPTION

A passively managed exchange-traded fund (ETF) is designed to follow the performance of a particular stock or bond index (or benchmark) and provide the investor with moderate dividends and capital growth. Holdings may come from domestic or foreign companies depending on the particular index the fund tracks.

OBJECTIVE

Long-term growth of capital or current income through a portfolio consisting of common stocks or bonds mimicking the performance of an index or a benchmark.

SUITABILITY

ETFs are suitable for investors seeking diversification and a portfolio that follows the movements of the index it tracks. They may also be a fit for investors seeking growth or moderate income.

RISKS

It’s important to note that while an ETF attempts to track a benchmark, its performance will not always mirror the exact return of the benchmark due to the fund’s expenses. Additionally, ETFs may not always own every security held in the benchmark, which can also lead to differences in performance. Since an ETF trades on an exchange, its share price is impacted by the supply and demand for shares in the market, which may cause its price to differ from the value of the assets held in the ETF.

PRODUCT FEATURES:

  • Diversification – ETFs are designed to track an index and own a wide variety of securities. This allows the investor to avoid putting all of his or her dollars in one investment.
  • Passive management – The securities in ETFs are selected to mirror an index and are passively managed; buys and sells are necessary only to keep the portfolio in line with the index. This results in lower costs relative to most actively managed funds.
  • Income – An ETF may pay dividends or interest if the dividend or interest payments of the investments contained in the portfolio exceed the ETF’s expense ratio.
  • Tax considerations – You should consider dividend, interest and capital gains payments and their effects on your taxes before investing. ETFs may generate smaller capital gains taxes than actively managed funds because of less buying and selling within the portfolio during the year.
  • Liquidity – Shares may be sold throughout any business day at their current price on the exchange on which they are listed. This price may be more or less than the original purchase price.
  • Fluctuating price and rates – ETFs are not fixed-income investments and will fluctuate in share price, dividend rates and interest income.
 

FIXED INCOME (BONDS & CDs)

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Fixed income investments are an important part of a well-diversified portfolio. Fixed income investments pay interest at specified times in fixed amounts, and are usually issued by a corporation, municipality, government or government sponsored agency.

There are two primary reasons investors may want to include fixed income investments in their portfolio:

  • Regular Income – Fixed income investments provide a stable and regular stream of income.
  • Diversification – Fixed income investments are essential to the performance of an individual investor’s portfolio.

FIXED INCOME INVESTMENTS INCLUDE:

  • Certificates of Deposit (CDs)
  • Corporate Bonds
  • Government-sponsored Enterprises
  • Mortgage-backed Securities
  • Tax-free Municipal Bonds
  • Build America Bonds
  • U.S. Treasury Securities
  • Zero Coupon Bonds

To determine if fixed income investments are suitable for your portfolio, please contact Jay Parrish.

 

MUTUAL FUNDS

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At JLP Investments, we believe strongly in the value of a diversified portfolio. Investing in mutual funds is one way to help accomplish this goal.

Mutual funds are diversified, professionally-managed portfolios of securities that pool the assets of individuals and organizations to invest toward a common objective such as current income or long-term growth.

Keep in mind, all investments, including mutual funds, carry a certain amount of risk. If you have additional questions please set up a meeting with Jay Parrish to discuss your investment needs and to determine if a mutual fund is suitable for you.

ADVANTAGES OF MUTUAL FUNDS

The primary advantages of owning Mutual Funds are diversification, professional management and convenience.

BUILDING YOUR MUTUAL FUND PORTFOLIO

What are you saving for? What is your risk tolerance? There are many things to think about when considering if mutual funds are right for you.

 

PREFERRED STOCK

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Preferred stock (also known as “preferred shares”) is a special type of equity that usually carries no voting rights. However, the stock may take priority over common stock in dividend payment and in the event of liquidation.

 

STOCKS

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There’s more to investing than “buy low, sell high.” At JLP Investments, we focus on the concept of buying and holding quality investments over time to meet specific goals.

Stocks can play an important role in your portfolio for a variety of reasons, including:

  • Current income needs
  • Potential for growth of principal and accumulation of wealth
  • Potentially offsetting inflation

PRINCIPLES OF STOCK INVESTING

Stock ownership represents shares of ownership in a company and a claim on part of its assets and profits. As an investment type, stocks have historically outperformed most other investments over the long term. With more than 65,000 stocks available globally to purchase, it’s difficult to select the appropriate investments for your portfolio. That’s where Edward Jones research analysts come in. For each stock, our research analysts review the underlying company’s track record and valuation, and evaluate the stock’s potential for rising income. We promote a disciplined approach to investing and recommend that you:

  • Stick with Quality
  • Diversify
  • Invest for the Long Term

For more information about investing in stocks or to open an account, please contact: Jay Parrish.

 

UNIT TRUSTS

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  • Equity Unit Investment Trusts
  • Taxable Bond Unit Trusts
  • Tax-exempt Bond Unit Trusts
 

ANNUITY INVESTMENTS

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An annuity is an insurance policy sold by an insurance company designed to provide an income, usually after retirement, that cannot be outlived.

An annuity contract has two phases: an accumulation phase and a payout phase. During the accumulation phase, the contract owner makes a payment or payments into the contract in exchange for either a fixed or variable return that is not subject to income taxes until withdrawal, permitting the tax deferred growth of your investment. During the payout phase, the accumulated value of the annuity contract can be converted into an income stream that can last for a set period of time or for as long as one lives.

An annuity contract can also be purchased that immediately pays an income stream. This type of contract is called an immediate annuity.

  • Fixed
  • Immediate
  • Variable