The top five alternative investments you may not have known about
If you’re interested in diversifying your investments, there are many options for you to consider. Here are five you may not already know about.
While many people know about the potential upside of investing in real estate as an alternative investment, not everybody decides to pursue that sort of investment strategy.
That said, alternative investments have a powerful role to play in protecting your investment portfolio from hiccups in the market that could come from having too many of your eggs in one basket.
After all, the last thing you want to do is be on the precipice of retirement only to watch the stock market crater because of an existential threat to society such as a global pandemic.
So, what should you do as a smart investor who’s concerned about their financial future? The answer, plain and simple, is to diversify your portfolio by selecting a few alternative investments to mix some of your investment dollars up.
While Yieldstreet has a great overview of a full list of alternative investments, here are five of the top alternative assets you may not have heard of.
1) Collectibles
From art to stamps to trading cards, collectibles have a very high ceiling if you’re a patient investor. This is because the secondary market can fluctuate wildly, so the concept of buying low and selling high has major payoff if you can pick your investments well.
Take, for example, an artist like Katherine Bernhardt, who could be easily dismissed as making paintings you’d see in the halls of a high school art fair.
Savvy collectors can make a fortune in a short amount of time by spotting up-and-comers like Bernhardt, whose painting “Doritos and Cigarettes” sold at auction for $43,750, more than double its estimated auction value of $18,000.
2) Private equity
While many lawyers structure their fees based on whether or not they win the case, others don’t. In these situations, investing in litigation can help you get a cut of the settlement as well as help someone else without the means to fund their legal counsel themselves.
In addition to the lawyers getting a cut of the case settlement, you also get a piece of the pie and the knowledge that you’ve helped someone get the legal help they need.
3) Movies
Investing in independent or low-budget films can help you fulfill your lifelong dream of working in the movies. Often, even fifty or one hundred thousand dollars is all it takes in order to have a stake in the proceeds from a film.
And with studios like Amazon, Netflix, and Hulu hungry for new content, distribution channels make monetizing an independent film easier than ever, so it’s highly likely you’ll make back your investment and then some.
4) Intellectual property
Intellectual property requires due diligence if you want to cash in since its value has a habit to appreciate or depreciate based on how popular it seems.
Whether you’re investing in a patent or a copywritten work like a song or invention, it’s possible to make a lot of money, especially if you adopt brand investing strategies. While not for the faint-of-heart, IP investing can prove lucrative with the right research and patience.
