Opportunity Zone Magazine Opportunity Zone Magazine Volume 1, Issue 1 | Page 82

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OPPORTUNITY ZONE MAGAZINE | VOLUME 1
•
ISSUE 1
...investor objectives
must be aligned with the
investment strategy of the
QOF so a mutually-beneficial
connection exists.
As a consequence, a review of the exit strategy prior to
investment is important to ensure that the appropriate
investment goals for each respective investor can be met by
the fund sponsor. Just like any typical investments, investor
objectives must be aligned with the investment strategy of the
QOF so a mutually-beneficial connection exists.
RISK TOLERANCE
Although investing in OZ funds brings significant tax benefits
for investors, inherent risks are still present. In general,
investing requires moving outside comfort zones and knowing
one’s tolerance for gambling. An assessment of project risk,
adjusted returns, financial capacity, mutual compatibility and
investment merits is useful. As American entrepreneur and
Chairman of Research Affiliates, Robert D. Arnott said, “In
investing, what is comfortable is rarely profitable."
A WINDOW OF OPPORTUNITIES
OZ Funds is a novel investment alternative and deserves
appropriate due diligence to ensure investment returns are
met, objectives are accomplished, alignment of interests by
all parties are achieved, and communities are well-served.
“Cautiously optimistic” is an apt description of the approach
that investors must utilized since this new program can bring
significant returns, tax benefits and community impact if
executed properly.
An assessment of
project risk, adjusted returns,
financial capacity,
mutual compatibility and
investment merits is useful.
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