YieldStreet is a comprehensive investment platform that allows you to invest in alternative assets such as art, real estate, cryptocurrencies and many other assets. Many features are available to accredited investors, but their flagship fund is open to everyone and costs just $500 to get started.
Pros & Cons
- A wide variety of alternative asset classes
- The Primary Fund is available to non-accredited investors and has a minimum of $500
- Short-term and long-term investments are possible
- Create objective-based portfolios for goals such as income or growth
- One option for non-accredited investors
- Many offers require an investment of $15,000 or more
- There is no secondary market to improve liquidity
What Is Yieldstreet?
YieldStreetYieldstreet is a platform that connects investors with alternative investments in asset classes such as fine arts, cryptocurrencies, litigation finance, real estate and consumer finance. The company started operating in 2014. Since its inception, it has seen more than $3 billion in funding on the platform and has generated an annual net return (IRR) of 9.71%.
The company's goal is to make alternative investments more accessible and flexible. You can invest in various individual offerings at Yieldstreet or its Prism Fund, which provides exposure to multiple asset classes.
YieldStreet also allows you to create objective-based portfolios, such as your income or growth portfolio model, to help you select assets that match your investment goals.
Who Is Yieldstreet For?
There are many alternative asset investment platforms available these days. For example, you can use Masterworks to invest in fine art or Fundrise to invest in commercial real estate.
However, Yieldsteer is one of the few platforms that brings together a range of alternative assets under one roof. It's a great option if you want to be involved in multiple asset classes without having to manage multiple accounts with different companies. And because the Yieldstreet team finds and vets deals, it saves you a lot of research and due diligence.
Yieldstreet Investment Opportunities
The advantage of Yieldstreet is that it offers a variety of funds as well as individual offers. If you want to diversify your portfolio, their funds are the best option. There are currently seven multi-asset fund classes to choose from:
- Yieldstreet Prism Fund This flagship fund has a minimum investment requirement of $500 and is open to non-accredited investors. It is a fixed income portfolio across multiple asset classes such as art, real estate and commercial and consumer finance.
- Art Equity Fund IV:. With a minimum of $15,000, this fund allows you to invest in a portfolio of artworks by famous contemporary artists.
- SFR Diversified Fund I:This fund also has a $15,000 minimum and invests in a portfolio of single-family rentals in multiple US markets.
- Enhanced Crypto Fund:Contains five to ten largest cryptocurrencies by market cap and also requires $15,000 to invest.
- Growth & Income REIT: This non-traded REIT has a minimum of $5,000 and invests capital in a variety of real estate properties across the United States.
- Specialty Finance Fund II:This fund invests in financial transactions in the commercial and consumer sectors and has a minimum of $25,000.
- StepStone Venture Capital Fund I: A portion of this fund is managed by StepStone Group Inc., a large alternative asset management firm that focuses on venture capital investments. There is a minimum investment requirement of $25,000.
Yieldstreet also has many individual offers and some are unique. For example, it can help finance various supply chain orders as a form of private credit. And right now, you can invest in private equity in Fetch Rewards, the leading grocery rewards app, through its Series E funding round.
Yieldstreet also allows you to invest in structured notes, which are debt instruments linked to the performance of an underlying security such as an index. They provide short term investment and regular income if that is your goal.
Overall, Yieldstreet has an impressive number of offers. And the offerings are tailored to balanced growth, income and investment styles.
What Makes Yieldstreet Great?
With over 300,000 customers, Yieldstreet is one of the most popular alternative investment marketplaces. And this popularity is not surprising considering its many advantages.
Low Investment Requirement For Main Fund
Most Yieldstreet investments require $15,000 or more to invest, as well as being an accredited investor. However, the basic Prism Fund only requires $500 and is open to non-accredited investors. And this fund provides broad diversification, making it an excellent starting point for investing in alternative assets.
Another advantage of Yieldstreet is that it has useful filters to help you build a portfolio that matches your investment goals and risk tolerance level.
When searching for deals, you can use filters to categorize assets that provide income, growth, or balanced income. You can also answer a short questionnaire about your goals and investment style to allow Yieldstreet to make personalized recommendations.
The bottom line is that you can create a diversified portfolio that matches your desired return and holding period.
Deal Vetting Process
Although not obvious on the surface, much of the benefit of Yieldstreet is the team due diligence process that takes place behind the scenes.
Before Yieldstreet markets anything, it goes through a five-stage research process. Few chances make it past the first round of review by the Yieldstreet underwriting team. From there, the team digs deeper into the proposal and considers factors such as:
- Management team experience
- Escape strategy
- Past and present trajectory
- Alignment of interests
Yieldstreet also typically targets companies with $50 to $2 billion or more in invested capital, so it doesn't offer investors minos without any experience.
There is more focus and due diligence at later stages. And Yieldstreet provides plenty of information on offers and documentation to help you do your own due diligence before investing or not.
Variety of Term Lengths
At Yieldstreet, you can invest in short-term structured notes or funds with a holding period of five years or more. This variety means there's something for everyone, whether you're investing for the short term or your future.
What Are Yieldstreet's Drawbacks?
Despite being one of the best alternative investment platforms, Yieldstreet has two major drawbacks that you should consider before investing.
Options For Non-Accredited Investors
The only option for non-accredited investors at Yieldstreet is their Prism Fund. The low investment requirement somewhat compensates for this, but it would be nice if there were more individual funds and deals for non-accredited investors.
The disadvantage of investing in alternative assets versus investing in assets like stocks or ETFs is liquidity. Alternative assets are generally illiquid, meaning that it is difficult or impossible to sell them before the holding period expires.
Most investments with Yieldstreet are illiquid and do not allow you to sell shares early. The main exception is the Prism Fund, which offers quarterly share buybacks at Yieldstreet's discretion.
But generally, your investment on Yieldstreet is not eligible for early selling, so it is subject to a holding period.
Yieldstreet Pricing & Fees
To make money, Yieldstreet charges an annual management fee of up to 2.5% on investment opportunities. Some offerings, such as short-term notes, have a 0% management fee. But Yieldstreet effectively determines how much it charges per asset. There are also annual fund fees that are paid by investors, but these are from the investment's cash flow.
However, Yieldstreet offers a target return for all management fees. This means that you don't really notice them because they are included in the advertised earnings. But you still pay annual management fees of up to 2.5%, and Yieldstreet outlines these fees on every deal page.
How to Open an Account
There are three steps to opening a Yieldstreet account.
- Verify your identity with a photo ID
- Link your bank account
- Check your accreditation status if you wish to invest in offerings other than Prism Fund
How to Contact Yieldstreet
You can contact Yieldstreet customer service by emailing firstname.lastname@example.org or calling 844-943-5378.
Yieldstreet is a trusted way to invest in alternative assets in a taxable account or your IRA. However, it's far from your only option. And depending on the asset class you're most interested in, there are several Yieldstreet competitors worth considering.
Best For: Beginner real estate investors.
If you're looking to invest in real estate on the cheap, Fundrise is our favorite Yieldstreet alternative. This leading crowdfunding platform allows you to start investing with as little as $10. It also provides multiple assets, allowing you to diversify your portfolio with commercial and residential real estate.
As an investor you receive quarterly dividends and your shares can appreciate. And Fundrise also has a secondary market to improve liquidity. He charges 1% per annum for fees. Historical returns range from 8% to 11% on average.
Get started with Fundrise
Best For: Alternative IRA investing
You can invest with your IRA with Yieldstreet, and it costs $299 per year for accounts under $100,000. But you can also use an Alto IRA to invest in multiple alternative asset classes, all within your IRA.
We like Alto because it works with over 75 alternative investment partners, giving you access to fine art, fine wine, real estate, venture capital and other asset classes. It also has a new Alto CryptoIRA product that allows you to invest in over 100 popular cryptocurrencies.
You pay $10 or $25 a month depending on your plan level with Alto's basic IRA plan. If you're only interested in investing in an IRA, we recommend comparing Alto's offerings to Yieldstreet's.
The company is open to non-accredited investors and has many offers that you can participate in. And there is also a secondary market to help improve liquidity. As for fees, Masterworks charges 1.5% per year plus 20% of future profits when parts are sold. Overall, it's a very beginner-friendly way to add fine art to your portfolio and has more to offer than Yieldstreet.
For investing in a variety of alternative assets, it's hard to beat Yieldstreet. Many platforms focus on only one type of asset, but with Yieldstreet you get a variety of individual funds and trades to diversify your portfolio.
The company also has an in-depth due diligence process and transparent pricing. And the fact that you can invest with your IRA or taxable account keeps things flexible.
That said, you still need to understand the risks of different alternative assets. These are highly illiquid investments and Yieldstreet does not guarantee returns. So make sure you do your own due diligence and think about how much of your portfolio you want to have in alternative assets before you take the plunge.