EstateGuru employee investment journey – Part 3: Tadas Mineikis

Hi, I am Tadas and I am an investor

A few years ago I was a stock market bull and had a vast majority of my savings in major stock market indexes. At the end of 2018, I experienced my first market correction and it felt like the world was going to collapse. I sold the majority of my stocks as big market swings and late-cycle stock volatility was definitely not for me. In 2019 the market sharply rebounded and my decision to sell didn’t look that great at all, however, the decision is saving me tons of nervousness in these turbulent times.

In 2019 I joined EstateGuru as a loan manager and found out that I can earn good returns without experiencing big swings like the ones that were happening in the stock market. My EstateGuru investments are earning me an average of 11% yearly, which is also higher than the 7% historic return which I could expect when investing in stocks. However, here I do not see any volatility in my earnings. Yes, 4% of my portfolio consists of loans that are in default, but I feel reassured by the fact that they are in the capable hands of our risk team and I will see them back once enforcement procedures are finished. These investments allow me to get stable good returns, so I keep increasing my portfolio bit by bit. COVID-19 brought tons of uncertainty for real estate as well, however, I see that EstateGuru has increased interest rates accordingly, and also that new projects coming into the platforms have lower LTV’s and are therefore safer.

I have investments in other p2p platforms as well. I have a smaller portion of my portfolio in equity crowdfunding, where I invest in products that could be part of our future life. These investments have low liquidity and I have no idea what my final return on them will be or even if there will be any returns, however, I like to support ideas that I find interesting. But as the returns are unknown, I do not have much money allocated there. I have also tried other p2p platforms, where I could invest in personal loans to individuals. However, these have a much higher risk profile than real estate backed loans while offering similar returns, so I have decided not to have much exposure there. Even when the platforms tend to offer buy-back guarantees, these guarantees are only as strong as the company providing them and I do not consider them as safe as real estate collateral.

I still have plenty of exposure to both stock and the bond market via pension funds and I keep investing in them to take advantage of tax breaks offered by the government. I have some cash on hand that I might invest in the stock market once the huge volatility goes away, but EstateGuru remains my main portfolio choice at the moment, as it’s unreasonable to expect real estate prices to drop significantly when governments keep increasing money supply and lowering interest rates, which will result in higher inflation at some point.