Cash, bonds and stocks have always been the primary sources of investment for countless investors over the years. However, it seems that the main 3 types of asset investments have taken a backseat to a fairly new type of investment opportunity. Known as alternative investments, this type is recently going mainstream, with an increasing number of investors choosing alternatives to the big 3. Despite the alternative label, there are plenty of ways for investors to profit from these alternatives.
- Hedge Funds
Over the past half a decade, hedge funds have begun to gain plenty of popularity, especially among high-profile investors. In fact, hedge funds have gained a reputation for being aggressively managed mutual funds for the rich. With numerous hedge funds doing so well, they become both a safe and high-return investment truly profitable.
2. Rare Pieces of Art
In all its forms, art is always an evergreen alternative investment investors can profit from. In general, the older and rarer the art is, the more it will sell for. Numerous artworks have been sold at auctions for significantly more than your own book value. As such, art is a highly profitable alternative investment.
3. Rare Collectibles
Collectible items such as rare coins, stamps and cars are always high-value items that can fetch significantly high profits. However, the key to profiting with rare collectibles is to purchase the items before collectors do. This is because collectors will always pay higher amounts for the piece of the collection they do not have.
Many wines have always been a high source of high return for many alternative investors, primarily because generally, the longer wines age, the greater their value. By investing in fine wines and select vintages, alternative investors will be able to profit substantially after at least a year, more if left for longer.
5. Managed Futures
Contrary to popular belief, managed futures are a type of pooled funds that are aggressively managed. The difference between hedge funds and managed futures thus becomes the regulations around them. As with the regular futures market, managed futures are also very risky. However, if the right investments are made and managed effectively, they can be a source of high return as well, making them a highly profitable alternative investment.
Alternative investments are going mainstream and it is becoming more important to know which alternatives you should invest in. By making the right selection, alternative investors will be able to profit more than ever.
Chris Turner is a versatile content writer with a passion for technology, finance, Investing and trading. He writes extensively on the subjects of Trading, Investing, Bitcoin, Forex trading, investing and general finance. He is writing and providing advice, education and encouragement to budding investors and traders, on Hedge Fund and alternative investments and other emerging financial trends. He is a contributor writer for HedgeThink.com and TradersDNA.com.