When most people think of investing, they think about the stock market and real estate. And this is rightfully so, the stock market has been generating wealth for some of the richest people in the world and many others. Real estate has been generating both cash for investors and raising net worth for decades. A lesser known investment is alternative investments, which are neither stocks nor real estate. Alternative investments and their value are not tied to stock market or housing market. They can be things like collectibles, art, or other valuable assets. Here are 5 benefits of alternative investments and things that are helpful to know to determine if alternative investments are right for you.
- They are all around you.
Some of the most valuable pieces of alternative investments are collectibles. You can walk into just about any store and find things that will be more valuable later or valuable now. While its hard to know which ones will grow the most, especially when you look at recent trends so as Pokemon cards and Yu-gi-oh cards.
2. Intellectual Property
They are a lot of ways that intellectual property. Some of the ways that you can use intellectual property is buying rights to domains or music/film rights. Other things you could be investing in are patents, copyrights, trade secrets, and a host of other things. One of the challenges is valuing these things with a direct dollar amount or finding where to invest in them as traditional brokers don’t often have ways of investing in these things. Other things like investing in rights to music can pay a dividend, while some are mostly held just as a way to diversify.
3. Accredited Investors
There is a barrier to entry when it comes to investing in alternative investments, especially when it comes to doing in hedge funds. An accredited investor who has one of the following traits: is worth more than $1,000,000, has a $5,000,000 worth of assets in their business, or grosses $200,000 per year. You can also become an accredited investor with a proven track record of success in investments. The becoming an accredited investor opens new doors for you as there are different SEC regulations on what is allowed and not allowed. Usually accredited investors are the ones taking in big…