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Hedge Your Risk
Risk, by definition, is the possibility that something bad or unpleasant will happen. We take risks, avoid them, mitigate them, and are surrounded by them at all times. From getting in our vehicles and traveling to investing our money or time, we take calculated risks every day.
We all have different levels of risk tolerance. We all have different perspectives of what risk is.
To some people, investing their time and money is a risk. To others, not investing their time and money is a risk. We don\\u2019t even always agree on what exactly risk is.
Obviously, real estate investing comes with some risk. However, not investing in real estate also comes with risk. Some people go so far as to avoid risk that they incur risks by doing nothing. Some will argue that investing is risky and to that, I say doing nothing is also risky.
There are opportunity costs of doing nothing. So this leaves us at a crossroads \\u2013 risk if we do risk if we don\\u2019t. SO how do we move forwards and not let risk paralyze us.
Well luckily for real estate investors there are ways we can hedge our risk. Let\\u2019s explore those.
*Bonus \\u2013 business entities, like LLC\\u2019s LLP\\u2019s, etc., property insurance, and equity.
As real estate investors, we\\u2019re constantly seeking asymmetric risk/return profiles, meaning the returns far outweigh the risks. The best hedge against risk is education. There\\u2019s nothing that pays a better dividend than investing in yourself. Once you understand how to protect your downside and mitigate risks, you can begin to take calculated risks that you may have once felt uncomfortable with.
Don\\u2019t let the fear of losing keep you from winning. Invest in yourself, continue to learn, and remember to look for opportunities where others see challenges.
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