What is meant by alternative assets?

Alternative assets typically refer to investments that fall outside of the traditional asset classes commonly accessed by most investors, such as stocks, bonds, or cash investments.

How much should you allocate to alternative investments?

A new study carried out by Dexia Asset Management shows the benefits of allocating 15\% to 20\% of a portfolio to alternative funds. Finding a good balance between risk and return is the first aim of any investment strategy.

Why is real estate considered and alternative investment?

Real estate When people buy investment property such as office or multifamily buildings, that’s considered an alternative investment. Those who don’t want to get quite so up-close and personal with their investment might use a broker to buy into private real estate investment trusts, or REITs.

What are the four main types of investment alternatives?

What are the main types of investment alternatives? Stocks, bonds, mutual funds, and real estate.

Why should you invest in alternative investments?

Alternative investments typically have a low correlation to more traditional asset classes, as discussed. Alternative assets therefore provide an opportunity for portfolio diversification, reducing overall risk exposure across investments. Many alternative assets also provide a hedge against inflation.

Should I add alternatives to my portfolio?

Adding alternatives to a diversified portfolio makes it more stable and less susceptible to swings in the market. Less Volatility: Many alternative investments are less volatile than stocks, making them a good choice for investors in search of portfolio stability.

Is Cryptocurrency an alternative investment?

Crypto can be an investment, but you can also buy things with it. It operates independently from the equity markets, similar to an alternative investment like real estate or commodities, except that it’s also hyper-liquid: It trades 24/7.

Is ETF an alternative investment?

Alternative investments are investments that fall outside the three traditional asset classes: stocks, bonds and cash. Unlike mutual funds, though, which can only be bought and sold at the end of the trading day, ETFs trade throughout the day on an exchange, just like a stock.