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What are Alternative Investments?

Unlike traditional assets (such as stocks, bonds and cash), alternatives generally fall into one of three broad categories:

Alternative assets, such as commodities, real estate, infrastructure or currencies

Alternative strategies, such as long/short, event-driven, market neutral, and global macro

Illiquid investments, such as private credit, private equity, or direct real estate

An Introduction to Active AlternativesTM

Why alternatives matter


Diversification

With the potential for lower correlation to stocks and bonds, alternative asset strategies can increase portfolio diversification.


Downside protection

Because they don’t move in tandem with stock and bond markets, alternative strategies can help mitigate risk in times of volatility and potentially enhance long-term risk-adjusted returns.

Access to additional sources of returns

Many alternative investments seek to deliver returns via trading strategies outside the “buy and hold” approach. They can complement existing holdings and provide a set of tools.