With traditional stocks, bonds, and mutual funds facing ongoing volatility, more investors are exploring alternatives in search of higher returns and better diversification, and Fred Hubler runs through several unconventional options. He cites a Cerulli Associates report showing high-net-worth clients now allocate an average of 9.1% of their assets to alternatives, with advisors expecting that to climb to 9.6% by 2024.
Hubler starts with three strategies worth understanding. Private debt means lending to companies or individuals that aren’t publicly traded, from small business loans to real estate mortgages, offering higher yields than traditional fixed income but requiring real due diligence on borrower creditworthiness. Arts and collectibles, like rare coins or vintage cars, can deliver attractive long-term returns but demand specialized expertise plus the cost of storing and insuring the collection. Venture capital means backing early-stage companies for high growth potential; Hubler notes it’s high-risk, high-reward, and recommends diversifying across many startups through a single program to improve the odds of “picking a winner.”
Alternative investing isn’t one strategy – it’s a whole toolbox, and Hubler covers five more options beyond these three.
See the other five strategies on Forbes, 8 Unconventional Strategies To Navigate Alternative Investments.