As the saying goes “Don’t put all of your eggs in one basket”, so should prudent investors not concentrate their funds. Spreading the risk across a number of different loans and different Borrowers will help form a sort of capital protection. Of course that doesn’t mean that diversification will guarantee zero losses, but it will help minimise the risk involved if one loan goes bad. So how can you diversify your portfolio? In this post we will look at the three main ways to diversify your portfolio with regards to property backed loans.
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