3 Exciting Categories Of Alternative Investments

As we have defined, detailed and exampled alternative investments over the last several weeks in The Juice, we have come to the conclusion that you can classify alts a few different ways. 

• As non-traditional investments. When you think of assets long available to all investors, you think of stocks, ETFs, bonds and real estate via direct property investment. Non-traditional investments are new or otherwise unconventional products that either don’t have the same track record as traditional investments or have not been available or easily accessible to everyday investors until recently. 
• As outliers/newish products within the traditional space. In this category we’re primarily talking about alternative ETFs. These are ETFs that employ an active strategy that does something more than attempt to mimic the returns of a broad index. 
• As investments that execute a strategy most individual investors could not execute on their own. Many alternative ETFs fall into this category. It would be challenging, if not impossible for most of us to, say, screen the S&P 500 for the top cash flow-producing companies than buy them in proper size and proportion. Or, even do something that sounds easier, but really isn’t, such as buy only the stock market’s top 20 names. If those last two sentences intrigue you, hit up today’s Freshly Squeezed section at the bottom of the page for more. 

So, alternative investing isn’t merely for beginners. We think it’s a joke financial pros say that alts are only for pros. It’s all about your goals and willingness to do the work, which includes understanding how the alts you’re interested in work and conducting a risk assessment.

One type of alternative investment is cryptocurrency. Slowly, but surely crypto feels like it’s becoming more mainstream, particularly among younger investors, including wealthy younger investors. 

We’ll make an educated assumption and say that some financial pros who say alts are only for pros are also anti-crypto. Essentially, they’re against the little guy having access to products and strategies once only reserved for professionals (e.g, venture capital, private credit, advanced ways to use leverage) or non-traditional assets that fall outside of their areas of specialization and don’t generate commissions.

At the same time as, say, dissing Bitcoin, they’ll allow the rest of us to easily access meme stocks, penny stocks and options contracts. All of the above are actually super risky propositions. Many investors shoot in the dark when they go into trades in those areas. 

Meanwhile, if you bought Bitcoin about six months ago for between $42,000 and $44,000, you’re sitting on close to $100,000 today. That’s 123% worth of upside in an asset that — by the freaking way — has done nothing but go up over the long haul (periods of admittedly scary volatility aside). Five years ago, one Bitcoin sold for approximately $7,500. How any member of the 1% — you know who you are — can talk shit about Bitcoin, then even imply that we should buy stock in their brick and mortar bank is beyond The Juice’s comprehension. 

This said, alt can be as simple as Bitcoin for you. Granted you were more alt if you bought Bitcoin five years ago than you would be today, but it’s still a primary example of one type of alternative investment. 

If you look at Bitcoin the way older investors might have looked at gold — as a store of value — it’s just a different way to do an aged old thing. Alts open up options to all types of investors, not just the rich ones. 

Along these lines, it used to be that if you wanted to profit off of real estate, you had to buy a house or become a landlord. Maybe you purchased a “real estate” mutual fund or ETF. But these are typically just investments in companies engaged in some type of real estate business. Today, through quite a few platforms, you can own a chunk of a real estate portfolio. And you can choose which type of real estate you’d like to own. 

Here again, a new and more accessible way to do an old, even traditional thing. The barriers to entry are lower, if not removed and you can track your real estate investment similarly to how you track your stock portfolio. In some cases, you can even receive income distributions in the process. 

Scroll The Juice’s archives and peruse the links in our Freshly Squeezed section for examples that bring to life many of the things we discussed today. And be sure to forward this email to a friend and tell them to subscribe to our little newsletter for free as we continue right into 2025 merging ideas in and methods of traditional and alternative investing. 

The Bottom Line: There’s change for the sake of change. We don’t like that. But there’s also change that, while scary and confusing at first, should be welcome news for investors. Today, we have more and often better ways to do old things alongside sophisticated products and strategies that allow us all to introduce new elements to our near- and long-term portfolios. 

As the traditional meets the alternative, there’s no question that we’re living in a golden age of investing with one unprecedented advance after another.

• What Are Alternative ETFs?
• Adding Color to the Investment Spectrum
• The Ultimate Alternative ETF To Buy Now
• Are Alternative Investment Options Only For ‘Professional’ Investors?