The Path Safety REIT Block is a better way to gain returns than keeping your money in cash as the yield on the Safety Block is generally a multiple of low interest-bearing checking accounts. Managing cash may seem trivial but it’s an important element of any investment strategy because the pennies add up over time.

There are rarely instances where the difference in return is so glaring than between the choice of being in cash and the next available alternative. Choosing between investing in the Russell 1000 index or the S&P 500 is essentially a coin flip of returns. Longer dated corporate bonds might yield more than short term securities, but the interest rate risk of longer dated corporate bonds may pose a threat to returns and comes with greater volatility, while the additional yield doesn’t begin to make up this gap. Even preferred securities and their blue-chip dividend paying counterparts experience extreme volatility in times like this.

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The problem with leaving your money at the bank in cash is that you are not only earning nothing but also allowing someone else to use your money for their own benefit. Banks love nothing more than cash sitting in an account as this becomes part of their lending base. I’ve found that money sits in cash because of one of three reasons: people are scared, they just haven’t taken the time to invest it, or they don’t know what to do with it. While our app, Path by Origin, can’t overcome the first two problems, the third reason is a problem we’ve solved. Path allows investors to easily diversify their capital in professionally managed and designed portfolios we call REIT Blocks.

Our Safety REIT Block is made up of three exchange traded funds (ETFs) that invest in fixed income products and is our safest REIT Block. The quality of the underlying securities, the managers, and the ability to be able to buy and sell as needed make it a great alternative to cash. However, return does not come with some level of risk. During the COVID 19-related market turbulence beginning in March, the Safety REIT Block experienced short-term volatility, but bounced back quickly and the year-to-date total return through May 19, 2020 was is 1.14%.* As of May 19, 2020, the estimated current yield in the Safety REIT Block is 2.19%,** but many checking accounts have a yield of 0%, so generating a positive yield is a better investing option for most investors.

Watch this video to learn more about the Safety REIT Block:

Downloading the Path app, setting up an account and transferring money securely via Plaid, one of the most widely used platforms in the world to connect to bank accounts, takes less than thirty minutes and could yield a significant return on your time. We also make it easy to withdraw money from Path so if you have a need for the money right away, your bank account will be linked upon registration and you can wire or send it via ACH quickly and easily.

Best of all, if you are a current investor in one of Origin Investments’ private funds, you won’t pay any asset management fee to Path up to the dollar value of your private investments. For example, if you have $250,000 invested in our private funds, then the first $250,000 in Path is free.***

In uncertain times, cash is king but that doesn’t mean it has to sit in your bank account. Path was designed as a tool to help investors make smarter investment decisions and it starts with just managing cash.

* The percentage return is a hypothetical back-tested result, which includes all income from dividends and interest, and realized and unrealized gains or losses, on the securities included in the portfolio. Hypothetical, back-tested performances have many inherent limitations only some of which are described as follows:
1. NAREIT, REIT Data, 2020, Model REIT Block hypothetical back tested results are achieved by means of retroactive application of a model designed using historical information. The hypothetical results shown depict how the particular portfolio has performed historically and do not contain any actual client performance data.
2. Model REIT Block hypothetical results reflect the deductions of advisory fees at the highest rate we may charge.
3. Model REIT Block hypothetical back tested results are calculated taking dividend reinvestments into consideration. Client portfolios may or may not reinvest dividends at the discretion of the client.
4. Past performance does not guarantee future results.
5. As with any other investments, there is potential for profit as well as the possibility of loss investing in our REIT Blocks.
6. There are inherent limitations in model and back-tested results, particularly the fact that such results did not represent actual trading and that they may not reflect the impact that material economic and market factors might have had on our decision making if we had actually been managing the Model Portfolio during such periods being measured. No representation or warranty is made as to the reasonableness of the assumptions made or that all assumptions used in achieving the hypothetical results have been stated or fully considered. Assumption changes may have a material impact on the model returns presented.
** The following disclosure pertains to estimated current yield (ECY). The ECY is computed by dividing the estimated annual income (EAI) by the current market price of the security, which may be higher or lower than the purchase price, and then the figure is multiplied by 100. With specific regard to a fixed income security, the initial purchase confirmation oftentimes reflects yield to maturity, yield to call and/or yield to worst figures, which are more relevant figures from the point of purchase. The ECY is an estimate and for informational purposes only. These figures are not considered to be a forecast or guarantee of future results. These figures are computed using information from providers believed to be reliable; however, no assurance can be made as to the accuracy. Since interest and dividend rates are subject to change at any time, and may be affected by current and future economic, political and business conditions, they should not be relied on for making investment, trading or tax decisions. The ECY assumes that the position quantities, interest and dividend rates, and prices remain constant. A capital gain or return of principal may be included in the figures for certain securities, thereby overstating them. The EAI for equities, exchange-traded funds and mutual fund securities is computed using a projected methodology (PM). The PM annualizes the latest regular cash dividend. If there is less than one year of dividend history, the accumulated dividends are annualized. The following are important caveats: (i) the figure does not contemplate special or extra dividends; (ii) when a security pays its first dividend with no specificity as to dividend frequency, the initial dividend will be the reported figure; (iii) if a security announces a stock split and does not announce a new dividend rate, the figure will be adjusted on the ex-distribution/dividend date; (iv) the EAI for mutual funds only includes dividends treated as income; and (v) the EAI will be zero under the following scenarios: a security that has only paid capital gains during the preceding year; a security that has only had stock splits, stock (not cash) dividends or reverse stock splits during the preceding year; a security other than an open-end mutual fund (excluding a money market fund), American Depository Receipt (ADR) preferred, or exchange-traded fund which rescinds or omits a dividend payment; and a security from an issuer which is in arrears and uncertain about its ability to make a dividend payment.
*** 0% fees only available to people who invest in Origin Investments’ private Funds. A technology wrap fee of 10 basis points (0.10%) will be charged to all investors. Additional terms, conditions, or eligibility requirements apply. Please see our Advisory Agreement for more information about fees.