Alternatives are investments from a variety of asset classes that have low correlations to most stocks and bonds, which can help diversify a portfolio.
Alternatives
What are alternatives?
Alternative investments have a broad reach: private equity, hedge funds, and real estate are just a few. They’re known for their low correlation with stocks and bonds, which can help diversification and improve risk-adjusted returns.
It’s difficult for some individual investors to achieve diversification and risk-adjusted return with alternative investments. They’re often volatile and illiquid, and they require some expertise to navigate successfully.