Alternative Investments Should Occupy 20% of Your Portfolio

Since the introduction of the global financial crisis, an investing trend has emerged from within the investment community. Investing in alternative offerings such as private equities, commodities, and hard assets are experiencing a sharp rise in interest from private investors and are beginning to see a prominent placement in investment portfolios. Much of this can be attributed to the fact that popular alternative assets, such as shipping containers for instance, are physical goods that are both tangible and have proven that they can deliver steady returns; even during tough economic times.

Prior to the financial crisis, alternative investments were a strategy used by super-wealthy  investors and were (for the most part) relatively unknown to the general investment community. Since that time, as this approach to investing has become a more widely accepted by investors everywhere, investing in hard assets and private equities have become a popular topic of conversation. As the word spreads, the steady rise in popularity experienced by established alternatives is causing many of the traditional investment offerings to take an expected downturn; and fall out of favor with investors. It would seem that the volatile performance of traditional investments, like the stock and bond markets, has finally proven to be too much for the investment community to accept.

Nowadays, advisers and wealth fund managers are recommending that alternative investments should occupy 20 to 30 per cent of an investment portfolio. In doing so, it is widely believed that investors can off-set some of the common risks associated with investing, particularly in traditional holdings. It is believed that this approach will help protect against common risk factors and ensure long-term investment success for the international investment community.