Walkercapital - What are alternative investments

Posted by John Smith on January 20th, 2020

When talking about alternative investments, it refers mainly to all those investments in assets that are difficult to quantify. And they are to maintain in the portfolio due to their illiquidity and difficult commercial valuation. Examples are investments in coins, stamps, wine bottles, art collections or other collections, among other exotic investments.

In other words, alternative assets are everything alternative to traditional assets such as shares of companies traded in highly liquid exchanges. Also, those are the investments in corporate debts or government debts and time deposits in banks. If you want to invest in this type of investment, it is advisable to contact the best and leading alternative investment management firm. 

The reality is that the number of individuals who choose to manage their own money and make a profit on their savings is increasing. As a result of the recent technological innovations that are emerging in the financial world, a large number of very different investment alternatives to traditional ones such as stocks, mutual funds or bonds are emerging lately.

There are types of unconventional investments in the market, some with high risk and high profitability, others with lower risk but with attractive returns. Let's see some examples:

1. An alternative investment in hedge funds:

It is a collective investment vehicle that is organized privately, managed by professional societies (investment banks or fund managers). They charge commissions on results obtained and not available to the general public since it requires minimum investment amounts very high.

These hedge funds have a greater degree of freedom than traditional funds, offering the freedom to invest in a wide variety of assets, in virtually any type of market. It is advisable to get in touch with alternative investment advisors to know more about this.

2. An alternative investment in managed futures:

Managed futures are an alternative asset class that has achieved very good results in the ups and downs of the market. It is showing a low correlation with traditional asset classes, such as stocks, bonds, cash, and real estate.

These are investment funds that trade with futures and with term contracts of financial assets such as currencies, interest rates or also with intangible assets.

3. An alternative investment in real assets:

Are those assets that correspond to tangible physical goods subject to use or consumption such as real estate, precious metals, commodities, etc. they have value on their own versus financial assets that have value for what they represent.