While the above example assumes a 50% win ratio, a professional litigation funder will perform significant legal due diligence on a case before investing to ensure they back cases with strong legal merits and thus higher prospects of success. It is thus not uncommon for investors to double, triple or quadruple their initial investment.
Most traditional asset classes — including bonds, equities and cash — generate returns based on underlying economic factors such as interest rates, inflation, employment and GDP. Even the so-called “alternative asset classes” are still heavily influenced by market vagaries and sentiment. It is thus difficult to find truly uncorrelated assets that can deliver genuine diversification to an asset portfolio.Litigation finance is unique.
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