Quora Answer: How Should I Invest $5 Million to Become a Billionaire?

The following is my answer to a Quora question: “I have $5 million dollars currently.  I am 24 years old.  How should I invest this $5 million to become a billionaire?”

On paper, it is not difficult.  You simply have to put your money in a collective investment scheme, any index fund, or mutual fund with an above average return, continuously reinvest your gains, and wait.  The reality is that the market goes through cycles, and you can lose that money too.  Also, what is the point of seeking to be a billionaire if you simply sat on money and waited for it to grow until you are well into your 60s?

It would make more sense to put some of that money into an index fund, or mutual fund, so that it generates a reasonable income for you.  Then, take the rest, and look for a good fund manager running a high-performance fund.  These funds have high risk, and they a high buy in.  It is likely that $5 million might not be enough, so you have to wait.  With some homework, you may find such a fund.  They belong to closed networks and are open only to select people, so it is important to network, and know the right people.

These are the funds you want, and they make insane returns over a short period of time.  They also lose money, so you must make sure you did not bet all your money on one hand.  This is a calculated risk.  People who run these funds often tell investors that they have some magic algorithm that beats the market.  The truth is much simpler: they know people in places, and pay for the information to move before the market does.  And because they are subtle and experienced, this sort of insider trading is almost impossible to prove unless there is a whistleblower.  And even then, what may be illegal in one country may simply be frowned upon in another.