Traditional portfolios of just stocks and bonds may no longer offer enough diversification. In today’s economic climate, more investors are looking to alternative assets to reduce risk and boost returns.

What are alternative assets? These include any investments outside of publicly traded stocks and bonds. Common examples:

• Real estate (direct or via REITs)
• Private equity and venture capital
• Hedge funds
• Commodities (gold, oil, agricultural products)
• Collectibles (art, wine, luxury watches)
• Cryptocurrency and digital assets

Why include alternatives?

• Low correlation – Many alternatives don’t move in sync with stock markets. This helps reduce volatility.
• Inflation protection – Assets like real estate and commodities tend to hold value when inflation rises.
• Income generation – Real estate, peer-to-peer lending, and some private funds offer steady cash flow.

Risks to consider:

• Liquidity – Many alternatives are hard to sell quickly.
• Access – Some require high minimum investments or accreditation.
• Transparency – Data may be limited, especially in private markets.

How to get started:

• Start small—allocate 5–15% of your portfolio.
• Use platforms like Fundrise (real estate), Yieldstreet (private credit), or crypto apps.
• Choose strategies aligned with your risk tolerance and time horizon.

When used correctly, alternative assets can strengthen your portfolio’s foundation, offering resilience and upside in uncertain times.