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Passive Income – The Yieldstreet Perspective

August 9, 2018 • 3 min read

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A quick Google search of “passive income” will leave you with a litany of tips, tricks, hacks, lists, guides and “weird ways” to generate passive income while working, on vacation, awake or even asleep.

The proliferation of “side-hustles” has moved into the mainstream as many Americans struggle with stagnant wages and crippling student debt. As a result, many have sought to generate a second income stream, which has complicated the true meaning of passive income.

We believe that generating passive income can not only help create long term wealth but also help provide an intermediate supplementary income stream.

At Yieldstreet, our investments are designed to generate passive income for investors. This means that after you initially invest, you will have funds, in the form of interest and or principal, flowing back into your account on a regular basis.

How often are you receiving payments that aren’t your paycheck?

This is drastically different from how stocks work. Unless you are investing in a dividend paying stock, you will not see any funds flow back to you unless you sell the stock or the company is acquired (outside of a special one-time dividend).

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Why Do We Think Generating Passive Income is Important?

Put simply: time and utility. Many investors want to have recurring cash flow from their investments that they can either use to reinvest, save or spend. Additionally, because of the short-term nature of our offerings (typically 12-36 months) investors know roughly when to expect to get their principal back.

Generating passive income can help provide flexibility and freedom. It removes the tough and potentially tax inefficient decision of when to sell a stock. This should allow investors a certain peace of mind when investing on Yieldstreet.

The Opposite of Active Income

We like to think about passive income as the opposite of active income – you are not actively working or participating in the accumulation of this second income stream on a daily, or even weekly basis. Earning passive income means relieving the continual need to buy, sell, or perform prolonged research for an investment after the purchase.

That does not mean investors should not thoroughly read and diligence investments before investing, however, after that initial period of research (and determination that an investment is right for you) the ‘active’ work ends.

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Invest in the Alternative Income Fund Today

Unboxing the Investing Time Capsule

Investing is often thought of as a time capsule – something you bury away and don’t touch until you need money it for retirement or to pay for college. We believe these benefits are so distant and intangible that it can feel onerous to save or invest because you can’t feel or see anything coming back to you.

But when your portfolio generates a steady passive income stream and funds come back to you on a regular basis – that feeling of tangibility returns and its benefits sprout to life.

Generating passive income through one’s investment portfolio can intermediate the two general needs of investing – creating more wealth and saving for the future. By having income flow back to you on an intermediate basis, you can use the funds intermediately to either spend now or reinvest towards the future.

This communication and the information contained in this article are provided for general informational purposes only and should neither be construed nor intended to be a recommendation to purchase, sell or hold any security or otherwise to be investment, tax, financial, accounting, legal, regulatory or compliance advice. Any link to a third-party website (or article contained therein) is not an endorsement, authorization or representation of our affiliation with that third party (or article). We do not exercise control over third-party websites, and we are not responsible or liable for the accuracy, legality, appropriateness, or any other aspect of such website (or article contained therein).

What's Yieldstreet?

Yieldstreet provides access to alternative investments previously reserved only for institutions and the ultra-wealthy. Our mission is to help millions of people generate $3 billion of income outside the traditional public markets by 2025. We are committed to making financial products more inclusive by creating a modern investment portfolio.

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We believe our 10 alternative asset classes, track record across 470+ investments, third party reviews, and history of innovation makes Yieldstreet “The leading platform for private market investing,” as compared to other private market investment platforms.

¹ Past performance is no guarantee of future results. Any historical returns, expected returns, or probability projections may not reflect actual future performance. All securities involve risk and may result in significant losses.

² Represents an net annualized return, using an internal rate of return (IRR) methodology, with respect to the matured investments shown in your Portfolio experience, utilizing the effective dates and amounts of subscriptions and distributions to and from the investments, net of management fees and all other expenses charged to the investments.[read more]

³ "Annual interest," "Annualized Return" or "Target Returns" represents a projected annual target rate of interest or annualized target return, and not returns or interest actually obtained by fund investors. “Term" represents the estimated term of the investment; the term of the fund is generally at the discretion of the fund’s manager, and may exceed the estimated term by a significant amount of time. Unless otherwise specified on the fund's offering page, target interest or returns are based on an analysis performed by Yieldstreet of the potential inflows and outflows related to the transactions in which the strategy or fund has engaged and/or is anticipated to engage in over the estimated term of the fund. There is no guarantee that targeted interest or returns will be realized or achieved or that an investment will be successful. Actual performance may deviate from these expectations materially, including due to market or economic factors, portfolio management decisions, modelling error, or other reasons.

⁴ Reflects the annualized distribution rate that is calculated by taking the most recent quarterly distribution approved by the Fund's Board of Directors and dividing it by prior quarter-end NAV and annualizing it. The Fund’s distribution may exceed its earnings. Therefore, a portion of the Fund’s distribution may be a return of the money you originally invested and represent a return of capital to you for tax purposes.

⁵ Represents the sum of the interest accrued in the statement period plus the interest paid in the statement period.

⁶ The internal rate of return ("IRR") represents an average net realized IRR with respect to all matured investments, excluding our Short Term Notes program, weighted by the investment size of each individual investment, made by private investment vehicles managed by YieldStreet Management, LLC from July 1, 2015 through and including July 18th, 2022, after deduction of management fees and all other expenses charged to investments.

⁷ Investors should carefully consider the investment objectives, risks, charges and expenses of the Yieldstreet Alternative Income Fund before investing. The prospectus for the Yieldstreet Alternative Income Fund contains this and other information about the Fund and can be obtained by emailing [email protected] or by referring to www.yieldstreetalternativeincomefund.com. The prospectus should be read carefully before investing in the Fund. Investments in the Fund are not bank deposits (and thus not insured by the FDIC or by any other federal governmental agency) and are not guaranteed by Yieldstreet or any other party.

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⁹ Statistics as of the most recent month end.

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