EstateX Co-Founder Bart de Bruijn on How to Future-Proof Your Investment Portfolio

"Future-proofing" might be the buzzword du jour in the investing world, but it's worth paying attention to. In a shifting market, investors must make sure their portfolios can weather upcoming changes in the financial and technological landscapes. Through EstateX, a fractional real estate ownership platform, Bart de Bruijn hopes to help more people than ever find a simple, reliable way to diversify and future-proof their portfolios.

He notes that in order to future-proof an investment portfolio, you need to have a portfolio in the first place — and for many people today, that's more difficult than it sounds. "The everyday person is in a state of emergency," he says. "The average 30-year-old now isn't even able to go to the property market. This has never happened before, so there needs to be a change."

Real estate has long been recognized as a stable investment that can generate significant returns, but historically, it's been an asset class that many people can't access. Fractional ownership changes that. "Even if you only have as little as a hundred dollars, you can get into the property market and start adding multiple streams of passive income," de Bruijn says.

For de Bruijn, EstateX is more than a business venture. In a world where many are facing an uncertain financial future, he hopes to help ordinary people find some modicum of security. "We have a solution, an ecosystem," he says. "We have the community, the partners, and the means to have a positive impact on the world."

However, the EstateX model isn't geared only toward those who haven't been able to invest in real estate until now. It also offers advantages for those who are already investing in real estate or who already have strong portfolios. 

Diversification is a critical element of future-proofing — but it's not limited to diversifying your portfolio across multiple asset classes. For investors seeking stability, diversifying investments within a single asset class can be incredibly helpful. Fractional real-estate investment makes this easy.

"You can have a worldwide portfolio in the palm of your hand," de Bruijn says. "Even if it's just $1,000, you could have $500 worth of a pension of a penthouse in Japan, $300 worth of a golf course in Texas, and $200 worth of an apartment building in London as well."

A strong portfolio is also a flexible portfolio, and flexibility makes it easy for investors to rearrange their investments to suit a changing market. Traditional real-estate investment — when an investor owns one or more properties — is not especially liquid. If an investor wants to exit the investment, they must sell the property. That's an ordeal in itself.

However, fractional real estate shares like those on EstateX make that process much easier. "We're bringing liquidity to an asset class that's not very liquid," says de Bruijn. "Property and real estate is probably one of the biggest, oldest, most secure, and most popular ways for people to invest. The only issue is that it's hard to make it very liquid. With EstateX, we aim to offer people liquidity straight away through cash out, lending and trading options."

Fractional real estate investment also makes investing in real estate faster and simpler in another regard: it doesn't require the investor to handle the cost or logistics of property management. That also means investors don't face the ever-present risk of expensive repairs on a property.

For instance, suppose that a traditional investor owns a property that generates $2,000 of passive income each month. However, it suddenly needs a $10,000 sewer repair. That repair isn't just an unexpected upfront cost — it also effectively erases five months of passive income.

If a fractional investor owns a share in a property that generates the same income, they would not be responsible for the upfront repair cost. While that cost would impact the total returns generated by the property, it would effectively be distributed among the shareholders. 

This means that the fractional investor would likely see a slight decrease in their total passive income from the property, but the impact would be significantly less than it would be if they owned the property outright.

So is EstateX (along with platforms like it) the future of investing? Maybe. No one can say for certain what the market will do in the future. But fractional real estate investments can distribute your risk and create more stability in your portfolio, and in times like these, that's exactly what you need.

This post was authored by an external contributor and does not represent Benzinga’s opinions and has not been edited for content. The information contained above is provided for informational and educational purposes only, and nothing contained herein should be construed as investment advice. Benzinga does not make any recommendation to buy or sell any security or any representation about the financial condition of any company.