In today’s investment environment, steady, guaranteed returns are a prize. With interest rates at historic lows, savings accounts, money market accounts, CDs, and other cash equivalents provide returns that fail to keep pace with inflation. For good reason, smart investors search for greener pastures. Cryptocurrencies are risky; the stock market has been on a tear, but its continued health is by no means guaranteed. What if you want to park a portion of your money in an income generating investment where your money isn’t subject to market corrections?
Shipping Container Investment Provides Guaranteed Returns
Shipping containers are now available to small investors. You can begin investing in shipping containers through container leasing companies based in Hong Kong. These operations are in the business of leasing the containers, which means the investor has no worries about handling the complicated logistics of finding renters for the containers. With shipping between Hong Kong and many international markets a constant flow, shipping containers remain in constant demand.
Each shipping container costs about $4,000 USD. Once the purchase is made, the investor is given title to the shipping container. The company then leases the container and passes the profits on to the investor, in the form of a quarterly dividend. There are no worries about where the shipping container goes or what it is used to transport. From the investor’s perspective, it makes no difference if the container goes to Los Angeles carrying a shipment of textiles or to London carrying a load of plastic toys. So long as the container remains in use, the investor gets his or her return.
Guaranteed or Market Rate?
Investors can choose from two plans. The guaranteed plan provides a 12-percent guaranteed return, or, if willing to assume market risk, the investor can allow the container to be leased at spot rates. Spot rates have yielded 20-percent returns for many investors.
Those who opt for the 12-percent guarantee know they earn that rate of return for a three-year period, a handsome payoff, especially considering that the investor has no downside risk. After three years, the investor can sell the container back to the company for the price they paid, guaranteed. Investors can opt to sell the container earlier, but they are subject to market rate on the sale, which means they may get less than they paid for it.
When investing in shipping containers, investors must consider the risk of damage or loss. Containers are transported through many ports, and accidents happen. There is also the possibility of damage or loss at sea. Thankfully, investor’s capital is protected by insurance policies, which will pay the full value of the container if it is destroyed.
Containers have an average lifespan of 12 years. Depreciation on the container can be taken against the dividends at tax time. Since the investor has proof of ownership, whatever befalls the container is tax deductible.
In today’s low interest rate environment, finding safe income streams remains challenging. Shipping container investment provides return superior to cash equivalents, even in a strong interest rate environment. To gain the returns that beat inflation, without the risks of the stock market, investors can broaden their investment horizons with shipping containers.
Davenport Laroche’s headquarters are strategically located in Hong Kong which allows investors to benefit from the busiest trading market in the world, China.