The 5 Best High-Return InvestmentsWith inflation now likely an enduring presence, it's more vital than ever to devote financial resources to vehicles with the most robust returns.

ByFeras Moussa

Opinions expressed by Entrepreneur contributors are their own.

When investing, everyone wants maximum returns. Weighing in only to make 1% to 2% on your money just isn't as exciting as getting back 8%, 10% or more, and during periods of inflation, high returns become even more essential (as it will make that 1% to 2% a net negative). The question, of course, is which investments with high returns are the best? In my experience, after analyzing the data, there are five you should consider. (It's worth imparting the disclaimer here that past performance is no guarantee of future returns. All investing involves risk of loss.)

1. Real estate syndications

A strategy in which a number of investors pool resources to purchase a property, real estate syndications are arguably one of the best ways of achieving high returns. Investors typically get about 8% to 10% per year, plus they enjoy appreciation as the building increases in value (while appreciation varies, it's not uncommon to see increases of 30% to 50%). Since the investment period is five years, these instruments have the potential to double your money or more: A $100,000 investment may make $50,000 over five years in rental income, plus $50,000 in appreciation.

Pros:Easy to start (totally passive), high ROI and you can pick your investments and projects.

Cons:Typically requires at least a $50,000 buy-in, and investors must beaccreditedto engage in these private offerings.

Related:Deciding Between a Multifamily or Single-Family Investment? There's an Unlikely Winner.

2. Rental real estate

Another way investors can get into real estate, and which also has substantial ROI potential, is through rental properties. People often buy single-family homes or condos and rent them out; some will even rent out rooms or floors in their primary homes. The ROI depends heavily on the market, but typically you're looking at somewhere between 5% to 10% per year.

Pros: This method is a straightforward investment with high returns. You merely need to pick the home, buy it and start renting it out.

Cons: You will be responsible for managing tenants, coordinating any repairs or maintenance and collecting rental income. You'll also need at least 20% down to get a mortgage, and if a tenant decides to skip out on rent, you will be stuck paying it. Additionally, tenants might damage the property, leaving the owner with repair bills that cut into returns.

3. Real estate investment trusts

Another excellent way to start investing in real estate, REIT companies trade on the major stock exchanges and typically have various real estate assets. They tend to pay reasonably good dividends, with yields that can rise as high as 5%.

Pros: REITs represent one of the easiest ways to start investing in real estate. You can even trade these stocks from your 401(k). Plus, the dividend yield can be substantial.

Cons: These are stocks, and as such are subject to many market whims. Even if the dividend is sound, that doesn't mean the underlying stock price will appreciate.

Related: 3 Top Industrial REITs to Add to Your Dividend Portfolio

4. Cryptocurrencies

People seem to love or hate cryptos, with little emotional space in between. Those who believe in them have driven up the prices substantially, to the point where Bitcoin — at least at the time ofthis May 2021 BuyShares articlewas published — had outperformed major indices by70 times. And some still believe crypto has a long way to go, so there remains a significant profit potential even though prices have gone up substantially.

Pros: Bitcoin, Litecoin, Ethereum and other currencies are easy to invest in thanks to large-scale trading sites. You can start with as much or as little as you want.

Cons: They are incredibly volatile — could quickly lose 50% of their worth in a month, or rise by 50%. The profit potential is high, but so is the risk!

5. Startups

If you love the thought of taking a chance on awe-inspiring ideas and new technology, investing in startups is both a risky and potentially profitable activity. There are plenty of new ones forming every day tackling some of the world's gravest challenges, and most need funding and guidance to achieve success. If they work out, these companies can result in substantial equity gains.

Pros: There is incredible upside potential. One of the biggest success stories is Peter Thiel, whose$500,000 investment in Facebook in 2004made him a billionaire by 2012.

Cons: Substantial risk. Some companies may make it big, but most will fail or result in minimal profits. Additionally, investors need to be accredited.

Related:2 Harsh Experiences Convinced Me Never to Invest in Friends' Companies

这五个,银团贷款,对我来说,可能represent the best mix of risk and reward — an opportunity to earn high returns in rental income and appreciation and without much of the risk associated with the other forms of investing. (Unlike crypto, you probably don't have to worry that your building will be worth 50% less in one day!)

Wavy Line
Feras Moussa

Entrepreneur Leadership Network Contributor

Managing Partner at Disrupt Equity

Feras Moussa is the managing partner at Disrupt Equity, a multi-family real-estate syndication firm dedicated to providing investors with strong passive income. To date, Disrupt Equity has acquired more than 3,000 units and over $250 million in assets.

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