Alternative Investment
Categories: Investing, Stocks, Index Funds, Managed Funds
See Alternative Asset. Investments of a vanilla flavor are things like stocks, bonds, and good ol' hard cash in the Serta. Alternative investments are things like hedge funds, real estate, commodities, and fancy derivatives. They're sometimes known as alts and are usually only owned by "accredited investors” (people with lots of money and the sophistication to understand that it's really easy to lose 100% of your money in these roll-the-dice kinds of situations).
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Finance: What is an Alternative Investme...2 Views
Finance a la shmoop...What is an alternative investment hmm well maybe we
should start with the opposite to define the term here sort of like with the fine [Good Housekeeping catalog]
people at Good Housekeeping do a primary or base or fundamental investment is
something easily tangible, understandable and definable like a collection of
stocks.. Primary also includes a collection of bonds simple like what
could be more primary than a t-bill or cash yeah cash that'd be primary lumpy [T-rex walking in a jungle]
mattresses well they're hard not to love so alternative is kind of the opposite
of these things mainly stuff like esoteric hedge funds, complex ownership
structures of real estate, or REITS - real estate investment trusts, commodity
ownership oh and fancy derivatives why is there a separate category for [Examples of alternative investments]
alternative investments well because when they go wrong they go oh so wrong...
and the people who own them mostly rich people and university endowments and
union pension funds those people have to sign what's called big boy and big girl [Person signs a big boy letter]
letters so that if they wake up one day in the home they thought was blessed by
the good housekeeping people is being repossessed well then the place they go [Woman opens door and reads notice of repossession]
to complain to the people responsible for making that stupid set of
investments is a mirror yeah it was clearly cracked and more than seven years
of bad luck coming... [Girl smashes mirror]