Artificial intelligence is taking the world by storm, and while virtually every sector is set to be inundated with the emerging technology, few seem to be as interesting as the finance world. These algorithmic, or algo bots use highly complex algorithms to analyze market trends, identify trading opportunities, and execute trades automatically. While algorithmic trading bots do not eliminate risk, they have been shown to generate substantial profits in certain circumstances. Those profits can be leveraged in a multitude of ways, including buying or investing in real estate.
Real estate investing has been a popular form of investing for centuries. Whether commercial real estate or simply the housing market, profits generated from using algo trading bots can potentially be utilized to build a sound real estate investment portfolio — or, to simply purchase a residential property.
Investing in real estate requires a significant amount of capital, and many investors may not have the necessary funds to make a substantial investment — or may not be able to make their purchase in their preferred tier of the housing market. This is where profits from algorithmic trading bots come into play.
One way to leverage profits from automated trading bots is to use them for the investment’s down payment — and a significant benefits of using profits from algo trading bots is that the down payment can potentially be bigger, which means the investor can secure a lower interest rate on their mortgage, which in turn results in lower monthly payments and generally more favorable loan terms.
Building a Real Estate Empire
Another way to leverage profits from algorithmic trading bots is to use them to purchase rental properties. Rental properties can generate passive income for investors, in turn generating even more capital to leverage as the investor sees fit.
Another option for investors is to invest in REITs, or real estate investment trusts. REITs are essentially companies that own and operate income producing properties such as commercial office space, apartments, and even shopping centers. Investors purchase shares in an REIT and receive a portion of the income generated from the property in the form of dividends.
Using the profits generated from automated trading bots to invest in REITs can provide investors with exposure to the real estate market without actually owning and managing the physical property. Furthermore, REITs are required to distribute at least 90 percent of their taxable income to shareholders, providing a potentially consistent stream of income.
Using the profits generated from algo bots can also be used to purchase a real estate investment property for the purposes of flipping. Flipping refers to purchasing a property, renovating it, and then selling it for a profit. Flipping can be an expensive and high risk endeavor, but if done correctly it has the potential to be lucrative.
Algorithmic trading bots can provide investors with the potential to generate significant profits. By using those profits to invest in real estate, investors can diversify their portfolios and potentially increase their overall returns.
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