Farmland Investing – Diversify with AcreTrader

Farmland Investing - Diversify with AcreTrader

“Diversification” – you will encounter the concept time and again when researching stock trading. Granted, diversification is important, and when it comes to investing, as in all areas of life, it’s best not to put all your eggs into one basket – but what does it really mean and how can one accomplish it?

Diversification is not only a matter of owning a bunch of different stocks. Rather, it’s key to have your money spread across industries and sectors. If this is somewhat confusing, think of “industries” or “sectors” in terms of “genre” – in a nutshell, you want your portfolio to contain numerous genres, or themes.

Thus, a successful investment portfolio is thoroughly postmodern.

Secondly, diversification means toying with different investment types. Novice investors tend to hone in on basic stocks; nevertheless, there are a number of rich market opportunities to consider, such as exchange-traded funds (ETFs), crypto currencies, commodities, and real estate investment trusts (REITs).

In fact, real estate is one of the best long-term assets to have on your side. And it does not need to be so incredibly hands-on; we don’t mean to suggest becoming a landlord, or a commercial real estate agent. But with a service like AcreTrader, it’s easier than ever to passively invest in land.

Founded in 2018 by Carter Malloy, AcreTrader is a novel platform that puts investors in touch with America’s rustic backbone. Geared towards farmland investment, Malloy’s intention is to open farmland to the average retail investor.

Modest Money’s review of AcreTrader notes that farmland has been notoriously underappreciated. And with annual appreciation rates somewhere in the ballpark of 7-9%, this is a sector of investing that simply cannot continue to be ignored. 

Let’s take a closer look at what makes AcreTrader a growing name in alternative real estate.

Key Features of AcreTrader

  • Ease of Use: AcreTrader is often praised for its simple, intuitive interface. If you’ve ever used an auto or robo-advisor like Betterment or M1 Finance, nothing will seem out of place here. What’s more, its simple to get up and running: once you’ve set up a user account and linked it to an existing bank account, you’re on your way. While there are not a ton of investing options, at least compared to other modern stock trade platforms, AcreTrader does one essential thing, and it does it well: long term investing in agricultural land.
  • Information and Knowledge: We’ve found that one of the neatest things about AcreTrader is how they provide a brief description of every “farmstead” available for investment. Having a bit of “narrative” to go along with your investment gives you a sense of knowing, or encountering the land. It also gives you a sense of having some stake in the real-world fortunes of laboring individuals.
  • Investment Thresholds: $10,000 is the minimum amount one can invest on AcreTrader, and investors are required to purchase at least one acre of land. This may seem extravagant, but in actuality it’s really not, for this is the real deal we are talking about – a finite, limited resource, a genuine slice of Mother Earth. And it must be noted that because of this “one acre rule”, initial investments may actually require upwards of $25,000 or more.
  • Accredited Investors Only: As of June 2021, AcreTrader is only available for accredited investors. Accredited investors are formally endowed with special “status” under financial regulation laws. In the United States, one must have a net worth that exceeds $1,000,000 or an income greater than $200,00 per year to be considered an accredited investor. This means that a great many of us are not able to partake in AcreTrader, though they do plan on opening it up to non-accredited users in the future.

AcreTrader – Rewarding Patience

AcreTrader may not be especially appealing to the “gunslinging” day-trader type, but for those looking to make sustainable, long-term investments, farmland is a valid option. AcreTrader’s profile is perfectly matched for those with the capital and patience to watch it grow.

Not only is farmland a “sustainable” asset that deserves a spot in any diverse portfolio, but investing in farmland also goes a long way in creating a more sustainable, green future. That’s because AcreTrader, in a bid to increase value and farming efficiency, implements the best agricultural practices, improves existing technologies on farms, and furnishes capital investments that give farmers new life.

It’s not off the mark to think of AcreTrader as injecting prosperity into a sector that has long taken a backseat to the flash, glitz, and market aggression of internet technologies and big pharmacy.

The Bottom Line – Is AcreTrader Legit?

AcreTrader has held an A rating with the Better Business Bureau since February of this year, and, in addition, all funds residing in escrow go through the North Capital Private Securities Corporation, a member of both SIPC and FINRA.

In other words, AcreTrader is a completely legit service. Though it is a relatively new way to invest, we think it has great potential for stable expansion.

Once the platform is opened to nonaccredited investors, it is likely to boom. In that case, if you are an accredited investor, do look into AcreTrader and get a head-start on the competition. And if you don’t know a thing about farming, that’s ok: AcreTrader provides users with great learning resources to get you up to speed.

Diversify your portfolio with something different.