What's Your Alternative
What Is an Alternative Investment?
An alternative investment is an asset that does not fall into one of the more traditional investment categories. Traditional categories include stocks, bonds, and cash. Alternative investments can include private equity or private credit, venture capital, hedge funds, managed futures, and art and antiques.
Real estate is also often classified as an alternative investment.
Key Takeaways
An alternative investment is a financial asset that does not fit into the traditional equity/income/cash categories.
Private equity or venture capital, hedge funds, real property, commodities, crypto, and tangible hard assets are all examples of alternative investments.
Most alternative investments have fewer regulations from the U.S. Securities and Exchange Commission (SEC) and tend to be somewhat illiquid.
While traditionally aimed at institutional or accredited investors, alternative investments have become accessible to retail investors via alternative funds.
