Don't invest unless you're prepared to lose all the money you invest. This is a high-risk investment and you are unlikely to be protected if something goes wrong. Take 2 mins to learn more.

Don't invest unless you're prepared to lose all the money you invest. This is a high-risk investment and you are unlikely to be protected if something goes wrong. Take 2 mins to learn more.

Risk Summary

Estimated reading time: 2 min

Due to the potential for losses, the Financial Conduct Authority (FCA) considers this investment to be very complex and high risk.

What are the key risks?

  1. You could lose all the money you invest
    • When you invest you will be issued bonds by a subsidiary property company (a 'Special Purpose Vehicle') that is dedicated to the opportunity you invest in. This property company makes a loan to the borrower. It is not an ongoing trading vehicle and does not have other avenues of generating income or returns.
    • Advertised rates of return aren’t guaranteed. This is not a savings account. If the issuer does not pay you back as agreed, you could earn less money than expected or nothing at all. A higher rate of return means a higher risk of losing your money. If it looks too good to be true, it probably is.
    • These investments are sometimes held in an Innovative Finance ISA (IFISA). While any potential gains from your investment will be tax free you can still lose all your money. An IFISA does not reduce the risk of the investment or protect you from losses.
  2. You are unlikely to be protected if something goes wrong
    • Protection from the Financial Services Compensation Scheme (FSCS) in relation to claims against failed regulated firms, does not cover poor investment performance. Try the FSCS investment protection checker here.
    • Protection from the Financial Ombudsman Service (FOS) does not cover poor investment performance. If you have a complaint against an FCA-regulated firm FOS may be able to consider it. Learn more about FOS protection here.
  3. You are unlikely to get your money back quickly
    • CapitalRise investments are illiquid and you need to be prepared to hold this investment for the full term.
    • We do operate a Bulletin Board where you can post your investment for sale, but there is no guarantee of a buyer. CapitalRise charge a fee for this service. Before you invest, you should consider if you will need access to those funds should your circumstances change.
  4. This is a complex investment
    • This investment includes loans made to property developers. Developers could misuse the invested funds without CapitalRise’s knowledge, thereby increasing the risk of default. Developers may also become unable to complete the scheduled work on time, or at all, for financial or other reasons.
    • This makes it difficult to predict how risky the investment is, but it will most likely be high.
    • You may wish to get financial advice before deciding to invest.
  5. Don’t put all your eggs in one basket
    • Putting all your money into a single business or type of investment for example, is risky. Spreading your money across different investments makes you less dependent on any one to do well.
    • A good rule of thumb is not to invest more than 10% of your money in high risk investments.

If you are interested in hearing more about how to protect yourself, visit the FCA’s website here.

For further information about minibonds, visit the FCA’s website here.

Investors are urged to seek independent professional advice when considering an investment. Investing places your capital at risk and you should diversify your investments. You cannot claim FSCS compensation if your original investment or returns are lost. There is no recognised market to sell this investment. Tax rules and allowances depend on your circumstances and may change. When investing you are providing a loan secured against property.
See Key Risks before investing.