Wealthy, Young Investors Are Buying Alternative Investments
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The more things change, the more they don’t stay the same. In Thursday’s Juice (see the link in today’s Freshly Squeezed section), we mentioned our multi-faceted approach to investing while updating our bull case on one of our top-performing stock picks. We suggested focusing your investing in three ways.
Consider today an important table setter to point number three, as The Juice amps up our coverage of alternative investments — with plenty of alternative investment ideas — through the end of 2024, into 2025.
It’s pretty remarkable actually. The distinction between young, wealthy investors and relatively old, wealthy investors. |
Continued…
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Follow the New Smart Money or the Old Smart Money? Bank of America’s 2024 Study of Wealthy Americans reveals something quite stunning, and instructive. This might knock your socks off, actually. First, who did BofA talk to? “A statistically representative sample” of people “who had at least $3 million in investable assets and were at least 21 years of age.” So, wealthy investors. Whether or not you’re in this company, the way the younger set is investing can certainly inform — and maybe enhance — what you’re already doing no matter your stage in life. When asked about their view on growth in traditional and alternative investments, there was some super interesting data.
But it gets even more intriguing. When asked where they see the greatest opportunities for growth, here’s how the 21-to-43 set replied:
When BofA asked the folks who are 44 and older the areas where they see the most growth potential, you can almost flip the list (particularly the top and bottom) upside down. It’s pretty remarkable actually.
This isn’t to say you should blindly follow younger wealthy people just because they’re young (or wealthy). However, it is to say that The Juice thinks they’re more than onto something. Especially with the focus on private equity and other alternative investments. No offense intended, but, let’s face it, when asked — in 2024 (!) — where you see the most opportunity for growth, “international stocks” is a very 1999 answer, particularly when you rank crypto/digital assets at the bottom and a relatively small number of people select other types of alternatives. Here again, this isn’t to say you shouldn’t invest internationally — or in any of the categories, for that matter — but it is to say that if you don’t keep an open mind to alternatives, you could be leaving money (or bigger profits) on the table. At the same time as you might be crazy to not invest in today’s stock market leaders (see, for example, today’s Trackstar top five at the bottom of the page), you’d be equally as nuts to blow off alternatives. If The Juice can read between the lines, we know some older investors not only refuse to cite alternatives, but they sometimes view them with skepticism, if not disdain. Be it crypto or venture capital. This is as much about resisting change and not understanding something as anything else. Don’t be a skeptic who views new things with disdain! The Bottom Line: In that regard, The Juice is here to bring the knowledge and ideas. We’ll (quickly) ease deeper into alternatives this week and throughout the year with the plan to right size your portfolio big time in 2025. We’ll also relay more insight from the BofA study as there’s lots more that’s instructive, especially if you’re looking to modernize your investment allocation. As with the stock market, we don’t see the political situation in the country changing the trajectory of everything from private equity to cryptocurrency. |
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