Essay Available:
Pages:
7 pages/β1925 words
Sources:
6 Sources
Style:
APA
Subject:
Accounting, Finance, SPSS
Type:
Research Paper
Language:
English (U.S.)
Document:
MS Word
Date:
Total cost:
$ 39.31
Topic:
Group Research Project 1: Investing in Non-Financial Asset
Research Paper Instructions:
Investing in Non-Financial Asset
Research Paper Sample Content Preview:
Real Asset Project
Name:
Institution:
Date:
Investing in Non-Financial Asset
Real asset or non-financial asset has the physical value. Such assets include real estate, machinery, equipment and vehicles among others. Such tangible assets give the real net worth. The non-financial asset is usually difficult to sell due to the existence of inactive market buyers and sellers that provide the price of such assets. Therefore, a seller needs to find a potential buyer then negotiate the sale price. The investors in real assets may choose either direct or indirect type of investments (Woychuk, 2017). Under the direct investments, an investor owns the asset, hence is wholly responsible for the asset and exercises full control of the asset. On the other hand, indirect investor allows other people to buy and sell an asset with no assumption of ownership of the asset (Woychuk, 2017). The buyers have no responsibility of the asset, but only get the shares of returns distributed among the indirect investors. Therefore, the implied investor exclusively invests on the expertise of the personnel using the investment asset. For more clarification, the present essay answers the below questions.
* Major categories of Real Assets and Individual Real Asset on each class
Real assets come in numerous groups. However, the well-known types in the USA include natural resources, real estate, and infrastructure.
Natural Resources
The natural resources as real assets fall into four categories namely:
1 Energy resources: the energy resources usually focus on the oil and gas that give income from the reserves, offer exposure to the commodity price and provides the potential and modest values.
2 Timberland and Forest: the timberlands and forest give returns from the production of the commodity especially through biological growth. Therefore, the classification of the assets under such category falls into timber production and harvesting (Best, 2017).
3 Agriculture: most investors value agriculture as a real asset since many invest in farmland that provides exposure prices for commodities and land. Therefore, rental payment and production of the products on the farm give high returns (Mercer, 2014).
4 Mining and minerals: most investors value opportunities in income-generating reserves such as minerals. Besides, the investors generate a lot of returns through private equity-focused strategies (Mercer, 2014).
Some examples of natural resource classification include an operating utility that exhibits high income to increase in maturity. Others include exploration and development that show high growth with increasing construction risks.
Infrastructure
Investors usually value infrastructure even though the asset exhibits high barriers to entry, economies of scale, sensitivity to inflation, inelastic demand and durability. The classes of infrastructure assets include production and harvesting that have high yields with an increase in maturity, pre-construction or private partnership with increased construction risks and high income. Besides, the airport in construction is another class with low growth rate with an increase in construction risks while operating toll road class gives moderate growth with increasing maturit...
Get the Whole Paper!
Not exactly what you need?
Do you need a custom essay? Order right now:
π Other Visitors are Viewing These APA Research Paper Samples:
- Accounting Journal Reviews1 page/β275 words | 1 Source | APA | Accounting, Finance, SPSS | Research Paper |
- Assignment 2 (Due Week 8): Investing in the Future, Overall Role of Investing in Personal Fi. . .5 pages/β1375 words | 3 Sources | APA | Accounting, Finance, SPSS | Research Paper |
- American corporate tax reforms4 pages/β1100 words | 4 Sources | APA | Accounting, Finance, SPSS | Research Paper |
- Forms of Business Entities7 pages/β1925 words | 8 Sources | APA | Accounting, Finance, SPSS | Research Paper |
- Large Stock Cap Fund5 pages/β1375 words | 4 Sources | APA | Accounting, Finance, SPSS | Research Paper |
- Computer Fraud : Adware2 pages/β550 words | 1 Source | APA | Accounting, Finance, SPSS | Research Paper |
- Impact of Sarbanes-Oxley Act (SOX)3 pages/β825 words | 6 Sources | APA | Accounting, Finance, SPSS | Research Paper |