If you're looking for longterm investments that are active, franchise businesses (7-Elevens, Dunkin Donuts, etc) are remarkably stable. Magic Johnson is a huge investor in these for this reason (and has a line of theaters)
Generally speaking, diversification is very very important.
Even though bonds, stocks, or other items might be doing poorly at the moment, diversification protects against a precipitous loss. So get some of each sort of security, some real estate, some counter cyclical stock (aka invest in companies that do fine in down markets). Make sure you get very comfy with your insurance agents as well: Liability and Errors and Omission insurance are very important now, as you're a target. Make sure you're properly covered on all your properties and that you use limited liability mechanisms with all your business ventures. Be very careful you understand what actions as a board member/fiduciary officer are not covered by the policies.
Additionally, keep more than you'd think is useful in a cash/near cash account. Opportunities arise quickly. The ability to write a 200k check this afternoon can make you many times your 5m sometimes.
A very serious aside:
At the same time, be very careful of deals with ??? in the plan, especially with people related to illegal drugs. If you're not sure what your money is going, it might be going to normal wasteful stuff, or it could end up related to drugs.
This is a good way to find everything of yours frozen, and you finding things getting seized (I looked at some of your old comments is why I mention this point, having known people who have had run ins when in a position like yours).
Your note on diversification reminds me of a video I recently saw from Eric Sprott. In it he said the following.
"I focus in on things. I get deep into things that I like. I dont worry about diversification. I think it was Warren Buffet who coined the term 'diworsification'. I dont belive in diversification. For example on the long side of our funds we are well through 70% into precious metals. For me, I am probably into 70-80% gold. For me it does not bother me because I know that is the place where I have to go."
Depends on life goals. If your primary goal is to amass further wealth, large bets on single items/industries can pay off very well. However, if your goal is to not lose wealth, then diversification is a very good strategy. The OP is in the latter school with these particular investments.
Additionally, I find it ironic you bring up Buffett: Berkshire is diversifying out of insurance :D
>Foremost, though, was his acknowledgment of the need for Berkshire to expand its non-insurance businesses, a broad collection that most prominently includes the railroad Burlington Northern and the electric utility MidAmerican.
Expanding on your advice: when diversifying it helps to not throw darts. It may be best to not have investments only in tech, auto, health, etc., but it's quite another to randomly choose a company or two in different sectors.
Unsolicited advice ;-):
* Tech: ARMH over MSFT over FB (phones/tablets need to be low, low power and P/E of FB seems egregious)
* Auto: VLKAY over F over GM (100MPG TDI trumps "made in USA" trumps bankruptcy)
Thanks for your help, I have considered buying a franchise but as you may know:
1. Good locations are taken
2. Priority generally given to current owners
3. It is a business I would have to overlook on a consistent basis (However a hotel investment I think would be okay in this sense, but again, good Hotel franchises are way more expensive plus again good locations are taken, and I do not want to work in the Boonies)
Again with the diversification: I'd be more inclined to buy several 350k stores than 1 multi-million dollar hotel. The added benefit is you do not need to be as involved as you think, as you can hire middle management pretty easily at that level. (I grew up in a 7-Eleven store, which was purchased by a guy in a similar situation to you, along with several other ones from prior owners).
Second, you can talk to far away yet successful chains and offer to be the "anchor" locally. Find a Vancouver chain, for instance, and convince them to open stores in Toronto, etc.
Also, remember there are tons of chains out there, including ones that don't have offices/aren't mainly associated with their offices. I mean, for instance, stuff like Deco, which is a lot of "on site" window repair (Full disclosure: I have a indirect relationship with them, but I say their name more because I'm an American who knows few Canadian businesses than any particular knowledge of Deco).
I would not be surprised to find out there is a Canadian office of business affairs who'd help point you towards franchise opportunities.
Lastly, you can purchase them from people who already own them (with most franchises). I know that's how my family got out of their 7-Eleven store. In this economy, I'm sure there are people looking to sell. If you look hard enough, you may find one who is doing so due to hardship rather than due to poor performance.
--
All that said: I say all the above because franchises are stupidly good at maintaining wealth. If you want passive and are willing to risk inflation issues, I'd go to with passive.
Also, you may want to buy some USD right now if you're all in CAD. USD swung down due to oil price issues. Oanda is cheap for large currency transactions according to my banker friend (flat fee as opposed to %). RBC also has free CAD->USD conversion for Canadians IIRC.
Then again, this might be permanent, and speculation is never a great way to gain security.
Generally speaking, diversification is very very important.
Even though bonds, stocks, or other items might be doing poorly at the moment, diversification protects against a precipitous loss. So get some of each sort of security, some real estate, some counter cyclical stock (aka invest in companies that do fine in down markets). Make sure you get very comfy with your insurance agents as well: Liability and Errors and Omission insurance are very important now, as you're a target. Make sure you're properly covered on all your properties and that you use limited liability mechanisms with all your business ventures. Be very careful you understand what actions as a board member/fiduciary officer are not covered by the policies.
Additionally, keep more than you'd think is useful in a cash/near cash account. Opportunities arise quickly. The ability to write a 200k check this afternoon can make you many times your 5m sometimes.
A very serious aside:
At the same time, be very careful of deals with ??? in the plan, especially with people related to illegal drugs. If you're not sure what your money is going, it might be going to normal wasteful stuff, or it could end up related to drugs.
This is a good way to find everything of yours frozen, and you finding things getting seized (I looked at some of your old comments is why I mention this point, having known people who have had run ins when in a position like yours).