Alternatives
Alternatives are financial instruments that provide investors with the opportunity to diversify their portfolios and access new markets. Alternatives can include hedge funds, private equity, venture capital, real estate, commodities, and derivatives. These investments are typically not available through traditional investments such as stocks and bonds. Alternatives can provide investors with higher returns, but also come with higher risks.
History of Alternatives
The concept of alternatives has been around for centuries, but the modern use of the term began in the late 1970s. At that time, hedge funds began to emerge as a way for investors to access new markets and diversify their portfolios. Since then, the use of alternatives has grown significantly, with more investors looking to access new markets and increase their returns.
Comparison of Alternatives
| Investment | Risk | Return |
|---|---|---|
| Hedge Funds | High | High |
| Private Equity | High | High |
| Venture Capital | High | High |
| Real Estate | Medium | Medium |
| Commodities | High | High |
| Derivatives | High | High |
Summary
Alternatives are financial instruments that provide investors with the opportunity to diversify their portfolios and access new markets. Alternatives can include hedge funds, private equity, venture capital, real estate, commodities, and derivatives. These investments are typically not available through traditional investments such as stocks and bonds. Alternatives can provide investors with higher returns, but also come with higher risks. For more information about alternatives, investors can visit websites such as Investopedia, The Balance, and Morningstar.
See Also
- Hedge Funds
- Private Equity
- Venture Capital
- Real Estate
- Commodities
- Derivatives
- Stocks
- Bonds
- Mutual Funds
- ETFs
