Many of the innovative new strategies Wall Street is rolling out are new versions of the same old thing. Markets. Volatility. Unknowns. Porky is just getting a new shade of lipstick.
Wall Street deals in traditional securities. Period. Most of the hedging and defensive strategies you’ll see coming to the fore to fight inflation and a shrinking economy are repackaged and repurposed versions of the same asset classes that are subject to adverse price movement and volatility.
To truly differentiate asset classes and achieve diversification in your portfolio, you have to deploy assets that work in different ways to offset the risks this economy poses to your purchasing power in the way you allocate assets.
Senior Life Settlements is an asset class that ticks many of the boxes that investors, novice or seasoned, want and need to inoculate their portfolios that Wall Street just can’t deliver:
- Diversification: Life settlements work differently mechanically than traditional asset classes and are immune to factors that cause price instability in markets
- Differentiation: The yield engine in a life settlement is a life insurance policy on a senior insured an investor owns at a significant discount to its face amount
- Non-Correlation: Life settlements are unaffected by market volatility, credit markets, interest rates, geopolitical unrest, natural forces, and mass risk events
- Risk Management: Using alternative investments in an asset allocation of stocks, bonds, and other market securities can reduce overall portfolio volatility, stabilize returns and preserve purchasing power
- Fractionalization: Diversified portfolios of life insurance contracts are divided into units or shares of private equity in multiple-policy portfolios to broaden participation amongst accredited investors
- Social Responsibility: Policy sellers are aged individuals who no longer want, need, or can afford their coverage that now have an additional option to sell their policy in a regulated secondary market to maximize the economic value of their asset
At Soteria Capital, we believe that every investor dollar should be treated the same way. The only profit margin to be realized from a life settlement is derived by optimizing the spread between the investor’s cost basis and the face amount of the policy paid out directly to the investor at each policy maturity. This Private-Equity style of Direct-Pay ownership maximizes the economic value of the investor’s asset. The Soteria Capital way is a more democratized approach to harvesting all the benefits and utility of this alternative asset class.
