Finance

Alternative Investments to Diversify Your Portfolio

Not all financial instruments are traded on a public exchange. You can also buy assets that are privately owned, a form of alternative investment. Discover the best alternative investments in this article.

What is an Alternative Investment?

You have probably wondered what you can best invest in to achieve a good return. Invest in ships, cryptocurrency or should you still keep saving? Due to the low interest rates, interest in the investment market is high and investors are broadening their horizons in the search for yield. There is a range of investment options that are interesting for both private and corporate investors.

At shipfinex you can invest in Alternative Assets in Shipping. Investing in ships is also a great opportunity for investors and you can leverage this opportunity through shipfinex. Marinecoin is the native exchange token of ShipFinex. The token will enable Alternative Assets in Shipping that generate income, global payments, remittances & operational expenditure by shipping companies worldwide

Beyond what you know now, most of the investment options are known to yield a significant ROI. From another perspective, it’s safe to say that the most popular shipping assets investments are hardly the most profitable. Without the significant barrier to entry, you may want to consider some of the alternative real estate investments discussed below.

An alternative investment is a private asset distinct from traditional markets, such as stocks & bonds, which are often traded on an exchange. These private assets include venture capital, private equity, derivative contracts, real estate & etc.

Positive aspects of alternative investments include the ability to hedge against inflation, as well as the low transaction costs compared to listed investments. However, due to the opaque legal structure of alternative investments, there is a high probability of scams taking place in this asset class. Therefore, it is even more important to make sure that you use a regulated broker to invest in this asset class.

Advantages and Disadvantages of Alternative Investments

1) Alternative investments have different advantages and disadvantages. One of the benefits of alternative investments is a more diversified portfolio. Alternative investments also have relatively low transaction costs compared to traditional investment instruments.

2) Alternative investments also have a potentially higher return due to the low correlation to the performance of traditional asset classes.

3) This asset class can be used as hedge against inflation. Leveraged products are often used as hedge against existing positions to minimize losses. Please note that while hedges can limit your losses if the market moves against you, they can also limit your profits if the market is in your favour.

4) A disadvantage of some alternative investments is their illiquidity, meaning that they are difficult to value or difficult to sell for cash.

5) While alternative investments can potentially yield high returns, they often also pose a high risk for investors. Make sure this type of investment is right for you, do your due diligence beforehand so that you are familiar with the risks involved.

Read More: What are Alternative Investments?

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