Which Asset Class is Right For You in 2021 ?

There are four asset classes in the world of investing, and in this blog, we will discuss which asset class is best for you by playing the Cash Flow game. Don’t know how the cash flow game works? No worries! We will tell you all about it in this blog.

Keep on reading to under what a class asset is, the different asset classes, and how playing the cash flow game helps you determine the best suitable asset class for you to invest in. 

What are the different Asset Classes?

An asset class can be defined as a group of similar investment vehicles. You can invest your money into any of these different classes or types of assets. 

Business

On number one, we have a business. It can be the businesses that you invest in or the businesses that you own. 

Real Estate

Next, we have real estate, which can be defined as a physical property. Real estate is known to protect investors at the time of inflation. It can be your own home or investment property. 

Paper Assets

These can be stocks, bonds, and mutual funds. 

Commodities

Last but not least, we have commodities. These include gold, silver, oil, gas, etc. 

How does the Cash Flow Game Work?

In the cash flow game, all the asset classes are included, and you need to discover for yourself which asset class is suitable for you.

If a class asset worked for someone else, it doesn’t need to work for you as well. For example, if your friend is into paper assets and tends to invest in stocks, it doesn’t need to end up being your thing as well.

You need to play the game to know whether this class of assets is the right one. You need to figure out on your own which asset class speaks to you the most. 

So, in the cash flow game, you will be trading stocks; you will learn when is the right time to buy and sell.

With real estate, you will face some real-life experiences that people have faced in their real estate investments. For example, you have cash-flowing properties, and all of a sudden, you have an opportunity to sell to a buyer that wants to pay good money for it. Now, what should you do?

Should you sell the property and lose your cash flow or hold on to the property and keep that cash flow? When you are playing the cash flow game, you will make new distinctions and learn new things because every time the game is different.

So, as you are playing the cash flow game, you will learn strategies on how these four asset classes, i.e., business, real estate, paper assets, and commodities, can help you move from the rat race onto the fast track.

You will find at least one asset class that speaks to you more than the others in the process. Thus, it is a great way to determine which asset class is best for you. 

Furthermore, you must have heard other people tell you thousands of times that you should diversify your portfolio. Typically, when someone is talking about diversifying your portfolio, they mean diversifying your stock portfolio, which means diversifying into different types of stocks. In the world of investments, you can diversify over the four asset classes.

To do that, you should play the cash play game and do that often as the more you play the game, the easier it will be to identify which class of asset speaks to you the most. In addition to this, it will help in improving your financial IQ.