Yieldstreet Review [2024]: Alternative Investments for More Than Just the 1%

Investors all have different goals and varying methods for achieving those goals. Similarly, investors typically have different tolerances for risk. To help spread out the risk, many investors diversify their portfolios by purchasing several assets rather than just a few.

Diversification can take the form of investing in different industries, such as banking and technology, or different asset classes, such as stocks and alternative assets. If you’re interested in diversifying part of your portfolio by investing in alternative investments, Yieldstreet has a few options you might want to consider.

What is Yieldstreet?

Yieldstreet was founded as an alternative investment platform in 2015 by Milind Mehere and Michael Weisz. They created the company to help individual investors invest in alternative assets that only the top 1% used to have access to. These investments include individual offerings and short-term notes investing in fine art, aviation, commercial, consumer, legal, and real estate investments as well as a multi-asset class fund option.

The company, headquartered in New York City, currently has more than 430,000 members, has raised over $3.5 billion on the platform, and returned more than $2.1 billion to investors. Yieldstreet is regulated by the U.S. Securities and Exchange Commission (SEC).

Minimum investment	$10,000 for Yieldstreet Prism Fund $10,000 and accredited investor status for short term notes $10,000-$25,000 and accredited investor status for individual offerings
Management fees	Prism Fund - 1% annual management fee and maximum 0.5% maximum annual administrative expense Short-term notes: no management fees or fund expenses  Individual offerings: varies by offering
Asset classes	Art finance Aviation Commercial finance Consumer finance Legal Real estate
Account types available	Taxable account Yieldstreet IRA (Roth or traditional)
Features	Diversify your portfolio with alternative asset investments Income-focused investments Completes due diligence on investments
Distributions	Yieldstreet Prism Fund: expected quarterly Short-term notes: at maturity Individual offerings: varies by offering
Best for...	Accredited investors who want to invest a portion of their portfolio in alternative assets.
	Visit Yieldstreet

What does Yieldstreet offer?

Yieldstreet opens up investments in alternative asset classes to more than just institutional and wealthy investors who have historically invested in these assets. The company has specialized teams that take a deep dive into potential investments to make sure they fit the company’s goals before offering them as investment options.

To give you an idea of how selective Yieldstreet is, the company vets billions of dollars worth of deals each year but approves less than 10% of them due to its due diligence process. This process includes independently analyzing financial metrics and assumptions using an objective approach. Then, they develop educational materials so investors can evaluate the investment and risks involved.

In particular, the company allows you to invest in one of three types of investments. These include the Yieldstreet Prism Fund, individual offerings, and short-term notes. It’s important to note that these investments do not guarantee liquidity. They’re designed to be held until maturity. And in some cases, investments may extend beyond the initially anticipated timeline.

Yieldstreet Prism Fund

The Yieldstreet Prism Fund is the only investment option available to all investors whether they’re accredited or not, but it requires a $10,000 minimum investment. The Fund manages the investments and invests in real estate debt, consumer finance, legal finance, art finance, corporate finance, commercial finance, and cash. The Fund aims to make quarterly distributions, though distributions are not guaranteed. It charges total annual fees of 1.5%. 

The Prism Fund was previously slated for a March 2024 termination date, but Yieldstreet has since transitioned it to an evergreen fund. 

Individual investments with Yieldstreet

Accredited investors can choose individual investments they’d like to invest in. These investments have a minimum investment amount of at least $10,000 per investment and reach as high as a $25,000 minimum. Fees for these investments range from 1.25% to 2% (not including flat annual expenses) based on the current offerings publicly available on its website. Investments and goals vary by individual investment.

Short-term notes with Yieldstreet

The final category of investments Yieldstreet offers is a short-term notes option. This is essentially short-term debt. Its short-term notes investments require a $10,000 minimum and target a five- or nine-month term. The net annualized return rate this investment type has achieved in the past is 4.6% (as of March 31, 2022).¹ <p>Past performance is no guarantee of future results. Any historical returns, expected returns, or probability projections may not reflect actual future performance. All securities involve risk and may result in significant losses.</p> <p>"Annual interest," "Annualized Return" or "Target Returns" represents a projected annual target rate of interest or annualized target return, and not returns or interest actually obtained by fund investors. “Term" represents the estimated term of the investment; the term of the fund is generally at the discretion of the fund’s manager, and may exceed the estimated term by a significant amount of time. Unless otherwise specified on the fund's offering page, target interest or returns are based on an analysis performed by Yieldstreet of the potential inflows and outflows related to the transactions in which the strategy or fund has engaged and/or is anticipated to engage in over the estimated term of the fund. There is no guarantee that targeted interest or returns will be realized or achieved or that an investment will be successful. Actual performance may deviate from these expectations materially, including due to market or economic factors, portfolio management decisions, modelling error, or other reasons.</p> <p>The internal rate of return ("IRR") represents an average net realized IRR with respect to all matured investments, excluding our Short Term Notes program, weighted by the investment size of each individual investment, made by private investment vehicles managed by YieldStreet Management, LLC from July 1, 2015 through and including July 18th, 2022, after deduction of management fees and all other expenses charged to investments.</p> <p>Investors should carefully consider the investment objectives, risks, charges and expenses of the Yieldstreet Prism Fund before investing. The prospectus for the Yieldstreet Prism Fund contains this and other information about the Fund and can be obtained by emailing investments@yieldstreetprismfund.com or by referring to www.yieldstreetprismfund.com. The prospectus should be read carefully before investing in the Fund. Investments in the Fund are not bank deposits (and thus not insured by the FDIC or by any other federal governmental agency) and are not guaranteed by Yieldstreet or any other party.</p> These funds do not have any management fees.

Alternative assets, as with any investment, come with risk. Carefully read the materials about each investment and learn about their historic investment returns. If you feel Yieldstreet is a good fit for your goals and risk tolerance, you can invest with Yieldstreet using its website, iOS, or Android app.

Pros and cons of Yieldstreet

Investing in Yieldstreet could be beneficial in some instances.

• It gives more people the ability to diversify their portfolios with alternative asset classes.
• Yieldstreet completes due diligence on potential investments before offering them to investors.
• Investments are focused on providing income to investors.

The company and its investments have some drawbacks, too.

• You must be an accredited investor to invest in individual offerings and short-term notes.
• Minimum investments of $10,000, $15,000, or more (depending on the investment) may be prohibitive while staying properly diversified.
• Investments are illiquid and cannot be sold at any time.
• Fees charged are often higher than low-cost investment options.
• Yieldstreet reached a settlement with the SEC in 2023. Yieldstreet did not admit or deny the SEC's findings. 

Who can open an account with Yieldstreet?

U.S. citizens with a valid employer identification number (EIN), taxpayer identification number (TIN), or Social Security number (SSN), with a U.S. bank account and U.S. mailing address can sign up for a Yieldstreet account. Certain people who are not U.S. citizens who live and work in the U.S. may also be eligible to invest. Nebraska and North Dakota residents are not allowed to invest at this time.

If you’re just starting out and learning how to invest money, Yieldstreet might not be the best platform for you. Investors need a $10,000 minimum to invest in the Yieldstreet Prism Fund. However, most assets on the platform require accredited investor status. These investments require a $10,000 minimum investment in short-term notes or a $10,000 to $25,000 minimum investment for some individual offerings.

An accredited investor is a person with a net worth of more than $1 million, excluding the value of their primary residence. Alternatively, you can qualify for accredited investor status by having an income of $200,000 as a single person or $300,000 combined with your spouse for each of the past two years. You must expect to earn the same income level in the current year. Financial professionals with any of the following licenses also qualify:

• Series 7
• Series 65
• Series 82

Yieldstreet is best for accredited investors who can access all of Yieldstreet’s investment options and want to diversify beyond traditional stock market investments. It’s also likely best for investors with a diversified, large portfolio, so their investment in alternative assets through Yieldstreet aligns with their risk tolerance. Investors’ investment horizons should also align with the asset’s maturity date. The investment options Yieldstreet offers are not generally liquid or easily sellable, as stocks or mutual funds can be.

How much can you earn with Yieldstreet?

Yieldstreet claims to have an 9.8% internal rate of return (IRR)² <p>The internal rate of return ("IRR") represents an average net realized IRR with respect to all matured investments weighted by the investment size of each individual investment, made by private investment vehicles managed by YieldStreet Management, LLC from July 1, 2015 through and including Jul 18th, 2022, after deduction of management fees and all other expenses charged to investments.</p> on all matured investments weighted by the investment size. This covers the period starting July 1, 2015, through July 18, 2022, and includes deductions for management fees and other expenses.

Despite this claim, it’s essential to realize that all investments come with the risk of loss. Although this is Yieldstreet’s overall IRR, individual investments may have performed better or worse. In a different period, similar investments could have much different rates of return and even potentially decrease in value. Carefully consider what assets you’re investing in, your timeline for investing, and risk tolerance to help figure out an estimate of the returns you might expect.

FAQs about Yieldstreet

How to open a Yieldstreet account

If you want to open an account on Yieldstreet, it isn’t too difficult, but Yieldstreet doesn’t state how long it takes. First, you answer a handful of questions about your financial status and experience with alternative investments. Then, you enter your contact information to sign up for an account.

You must provide a photo of your government-issued ID to verify your identity, link a bank account to fund your investments or your Yieldstreet Wallet, and confirm your accreditation if you want access to accredited investor-only investment options. 

You can verify your accredited investor status through a third-party agent, such as a certified public accountant, licensed attorney, an SEC- and FINRA-licensed broker-dealer, or certain investment advisors. Alternatively, you can provide documentation such as W-2s, tax returns, bank statements, asset statements, and a credit report to verify your status.

Other investing platforms to consider

The Yieldstreet platform may not be the perfect fit for everyone learning how to invest money or those who want to invest in alternative investments. 

Public’s investment offerings include stocks and ETFs as well as access to cryptocurrencies. Its focus is on community so you can get insights from other investors.³ <p>Offer valid for U.S. residents 18+ and subject to account approval. This is not a recommendation. You can lose money with any investment. Open To The Public Investing is a member of FINRA & SIPC. Regulatory and firm fees apply. See <a href="https://www.Public.com/disclosures/">Public.com/disclosures/</a>.</p> There's no minimum investment requirement.  

Visit Public | Read our Public review

People looking to invest solely in commercial real estate for their alternative investment assets may want to consider a crowdfunding platform like DiversyFund. DiversyFund doesn’t require you to be an accredited investor and requires only a $500 minimum investment to start investing in its commercial multifamily property real estate investment trusts (REITs). The company doesn’t charge an investment advisory fee but receives some of the profits when a REIT gets liquidated. 

Visit DiversyFund | Read our DiversyFund review

Bottom line

Alternative assets as a whole may not be a good fit for you at your current point in your investing journey. You can check out our list of the best investment apps and our list of the best brokerage accounts if this is the case for you.