Your Bear-Market Protection Policy

By Matthew Milner, on Wednesday, January 13, 2016

Remember the market collapse of 2000?

Triggered by the popping of the dot-com bubble, the market took years to recover.

Many financial professionals believe we’re in a similar bubble today.

And with the market down more than 5% this year already, some of them are concerned about a new crash—and about an impending bear market.

The fact is, nearly half the companies in the S&P 500 are already down more than 20% from their 52-week highs—putting them firmly in bear territory.

I don’t know about you, but the prospect of a bear market scares the heck out of me.

Which is why I’m always so thrilled to discover a new way to protect my assets

The Usual Strategies Aren’t Enough

In the market environment we have today, decent “protection policies” are hard to come by:

The 30-year bond, for example, is yielding just 2.9%.

And the average dividend yield for the S&P is only about 2%.

Sure, I want protection—but I’m not ready to accept 2% to get it.

But how about this as an alternative…

Stability, With a Proven Roadmap for Success

What if you could make an investment that enjoys success rates of up to 100%?

That might sound too good to be true—but here it is:

Franchises.

From McDonald’s restaurants, to H&R Block tax preparation, franchises are an opportunity to invest in a stable brand, with a proven roadmap for success.

The average McDonald’s [NYSE: MCD] franchise, for example, rings up annual sales of $2.6 million—and according to Kevin B. Murphy, an international franchise expert, the average McDonald’s franchise owner nets about 10% of sales.

While that’s great for the franchise owner (and great for the bank making the loan), it doesn’t do much for you:

If you invest in McDonald’s in the stock market, you’ll earn a yield of just 3.5%—and you’re still subject to the financial damage of a bear market.

But we found a solution to this investment challenge…

ApplePie Capital

ApplePie Capital is an online marketplace. It connects investors like you with entrepreneurs opening a franchise.

Marketplaces like this are part of the successful and fast-growing “Peer-to-Peer Lending” sector, where regular people pool their capital and lend it to others.

In the case of ApplePie, investors lend money to entrepreneurs seeking $100,000 to $1 million to open name-brand franchises like Einstein Bros Bagels.

This is good news for the entrepreneurs, as it expedites the process of securing capital at competitive rates…

And it’s good news for you, too.

Let’s see why…

Bear-Market Protection Policy

ApplePie offers investors projected annual returns of 7% to 12%.

Given the relatively low business risk, those are attractive yields.

But what’s so important here is that many of ApplePie’s franchise opportunities offer you a shot at earning these yields even if there’s a bear market.

To see what I mean, let’s look at a current ApplePie opportunity for a franchise called SERVPRO.

SERVPRO provides restoration services for fire and water damage. The company was founded in 1967, and since then, its 1,600+ franchises have fixed property damage ranging from multi-million dollar disasters at the Pentagon, to small fires and floods suffered by individual homeowners.

For five years in a row, from 2011 to 2015, Entrepreneur Magazine has named SERVPRO one of its “Top 10 Franchises.”

One reason it’s such a consistent business and franchise is that America's 114 million households collectively spend an estimated $12 billion a year on fire and water damage restoration services—but those billions don’t come directly from homeowners’ pockets; they’re paid for by insurance companies.

In other words, SERVPRO can do well in good times and bad because insurance companies are obligated to pay the claims.

Critically, however, each franchise is a privately-held business. And since it doesn’t trade on a stock exchange, your investment is immune to market declines.

Bottom line: an investment in a stable franchise is a bear-market protection policy.

The Details

The SERVPRO opportunity we’re writing about today is in San Diego County, CA.

It has a $2,500 minimum investment, and it offers investors a 9.45% interest rate for 60 months.

Investors are paid monthly, minus a 1% servicing fee. The expected net yield after all fees is 8.93%.

Keep in mind that ApplePie continually has new opportunities—from bagel stores to hair salons—many of which can provide bear-market protection policies, too.

To learn more about ApplePie and the SERVPRO deal, click here »

(Please note: Crowdability has no financial relationship with ApplePie Capital. Crowdability is an independent provider of information and research on the private equity markets. However, Social Leverage, an investor in ApplePie, is also an investor in Crowdability.)

Best Regards,
Matthew Milner

Founder
Crowdability.com

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