Alternative investments can be a great way to diversify your portfolio and spread risk across different asset classes. By adding alternative investment options to your portfolio, you could generate a better return but the core benefit is to hedge risk. If you’re looking to increase your returns and diversify your portfolio, you should consider investing in alternative investment options. Keep reading to learn more about five alternative investment options worth considering.
What Are Alternative Investments?
Alternative investment options are a type of investment that follows a different set of rules than traditional stocks and bonds. They often come with higher risks and lower yields, but they can also offer huge potential returns in some cases.
If you’re looking for an alternative investment, cryptocurrency could be worth considering. Cryptocurrency is a type of currency that only exists in a digital form. In order to generate the currency and verify fund transfers, cryptocurrency uses a series of encryption techniques Bitcoin, for example, is one type of cryptocurrency that has gained a lot of attention over the past few years. One way to invest in cryptocurrency is by purchasing bitcoin and other cryptocurrencies through online exchanges.
EIS Investment Funds
An EIS (Enterprise Investment Scheme) is a great alternative investment option to traditional stocks and bonds. An EIS is an Investment fund that invests in companies that qualify for the Enterprise Investment Scheme. You may be familiar with this scheme if you’ve ever heard of SEIS. The difference between SEIS and EIS is that you can only invest in very early-stage businesses through the SEIS schemes. If you want to invest in a more established early-stage company, the EIS scheme is a good option. Many investors choose an EIS fund because they want to diversify their portfolios with different types of assets. Additionally, investors also want more opportunities for capital growth as opposed to a more traditional investment such as a fixed income investment. To learn more about how you can invest in EIS, check out Oxford Capital and their Enterprise Investment Scheme.
Hedge funds are one of the best-known types of alternative investments. As hedge funds have been around for a while, they have become some of the most popular investment vehicles ever. Hedge funds typically invest in markets that are less liquid than publicly-traded stocks, such as currencies and commodities.
Collectables are a type of alternative investment that includes artwork, antiques, wine, and more. Collectables are typically considered items that are worth collecting as an investment. If you’re looking to diversify your portfolio, collectables can be a great option. Some collectables have increased in value over time and can be an excellent way to generate some extra income on the side. However, there are risks associated with investing in collectables because not all pieces will actually increase in value. In addition, the market is volatile, which means your investment may fluctuate with little notice.
Investing in property is one of the most popular and well-known alternative investment options. With many different types of property to choose from, investing often provides steady returns with a low-risk profile. You can invest in residential, commercial, or industrial properties to diversify your portfolio.