What are alternative investments?

Alternative investments include private equity, venture capital, hedge funds, managed futures and collectables like art and antiques. Commodities and real estate can also be classified as alternative investments. Who Can Buy Alternative Investments?

Should you invest in alternative investments?

Therefore, investors most often turn to alternatives to potentially help diversify an investment portfolio and reduce overall portfolio risk. Since alternatives are considered riskier investments, they often have the potential for higher returns compared to traditional investments.

How do alternative investments differ from traditional investments?

These kinds of investments differ from traditional investment types because they aren’t easily sold or converted into cash. It’s also common for alternative investments to be referred to as alternative assets. One of the most dynamic asset classes, alternatives cover a wide range of investments with unique characteristics.