Understand your Risk

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No matter what Investment you do in life there will be risks. Buying products through Proferlo brings its own unique set of risks. Its important that you understand the risks associated with "High Risk Investments"

Unlike investing in a bank where your money grows slowly or in the stock market where any return depends on the stability of the stocks purchased. Proferlo offers investors the opportunity for early stage investing. We manage risk by ensuring Investors own something tangible as part of there Investment. Investment products are owned outright by the investor, and the capital invested is associated with a single product or service, which will be sold for a defined value. 

With regards to the White Truffle Project, each tree is insured for £699.00, in the event that the Tree is harmed, damaged or does not produce Truffles, your Tree will be replaced by one that is producing Truffles under the replacement Insurance Guarantee. .  

The following is important to note: 

Proferlo,s approach to assessing a high-risk, high return investments involves a careful evaluation of multiple factors, as these types of investments have the potential for both substantial returns and significant losses. Here's a structured approach to help you assess the risk and reward potential of a high-risk investment:

• What kind of investment is it?
   
  • Equity (stocks, start-ups) - 
  • Debt (high-yield bonds, distressed debt)
  • Real assets (real estate, commodities)
  • Speculative assets (cryptocurrencies, options, derivatives)
  • Venture capital or angel investments (early-stage startups, tech, biotech)
     

• Company/Project Health:
   
  • Financials: Does the company have strong financial backing or an unsustainable cash burn? Analyse income statements, balance sheets, and cash flow statements.
  • Track Record: How experienced is the management team? If it's a startup, does the team have a proven history of success in the industry?
  • Intellectual Property: For tech, biotech, or other IP-heavy investments, are there patents or technologies that give the company a competitive edge?
     
• Market and Industry Analysis:
   
  • Market Size and Growth: Is the investment in an industry with high growth potential or in a niche with limited demand?
  • Competition: What does the competitive landscape look like? Are there other companies or investors that can take market share quickly?
  • Regulation: Is the sector heavily regulated (e.g., pharmaceuticals, financial services)? Understanding the regulatory environment can help you gauge potential delays or roadblocks.

• Upside Potential:
   
  • High reward: The potential for high returns in case of success, such as a blockbuster drug (biotech), market dominance (tech), or a real estate boom. 
  • Calculate projected returns: What are the forecasts for the investment’s growth or exit? Is the upside realistic based on market conditions or trends?
     
• Downside Risk:
   
  • Investment loss: What happens if the investment fails? Are you at risk of complete loss of principal? For example, in venture capital, 90% of early-stage startups fail, so it’s critical to assess how much of your capital is at risk.
  • Leverage Risk: If the investment involves leverage (e.g., margin trading, debt financing), how does the risk increase due to amplified exposure?
     

• Exit Strategy: How easily can you exit the investment?
   
  • Publicly traded stocks or bonds are easier to liquidate than private equity or real estate projects.
  • If the investment is in startups or private companies, consider the timeline for liquidity (e.g., IPO, acquisition).
  • If the investment has a lock-up period, you may not be able to sell until a specific date.
     
• Time Horizon: High-risk investments typically have a longer time horizon (5–10 years or more). Can you afford to tie up your capital for the duration of the investment?
   

• Diversification: High-risk investments should make up only a portion of your overall portfolio to balance risk. Spreading investments across different asset classes, sectors, and geographies can help reduce volatility.
• Hedging: Consider hedging strategies to protect against market swings, particularly if the investment is in highly volatile sectors like cryptocurrencies or emerging markets.
   

• Market Conditions: Is the investment susceptible to broader market conditions, such as a recession, interest rate changes, or currency fluctuations? For example, tech stocks may face headwinds during market corrections, and commodities may be affected by geopolitical events.
• Geopolitical Risk: Consider political instability or regulatory changes, particularly for emerging markets or international investments.
• Technological or Market Changes: Will technological disruption, regulatory changes, or shifting consumer preferences negatively impact your investment?
   

• Stress Testing: How will the investment perform under different scenarios? For example, simulate the potential outcomes if the market crashes or if growth projections are not met.
• Best-case, worst-case, and most-likely scenarios: Calculate potential returns and losses under each of these conditions to understand the range of possible outcomes.
   

• Leadership: Are the people behind the investment credible and experienced? The management team’s ability to execute the business plan is crucial in high-risk investments.
   
  • Check their reputation, track record in similar ventures, and any historical success or failures in prior investments.
     
• Investor Relations and Transparency: Is the company open about risks, potential rewards, and challenges? Can you easily access information about the investment? Transparency is important for understanding how the business is performing and identifying any emerging risks.

What happens if you want out early?

If you need to withdraw your investment early, Proferlo will make an offer to the Market on your behalf. Depending on the timeframes you can negotiate a percentage return with the market. 

What happens if the supply of a product is delayed?

If a product or service is delayed, Proferlo considers the transaction incomplete as it falls outside of the agreed timeframe. in which case Proferlo will notify you of the delay. As Proferlo has collated the purchase of products, you will receive the percentages of the income calculated for that period, based on the completed transactions. As you retain ownership of those products or services, the balance of your investment will be paid once the transaction has been completed.

What happens if the Transaction is cancelled?

In the unlikely event that a transaction is cancelled, you will receive a full refund