5 alternatives investment trends to watch
Several options are available for investors wanting to diversify their portfolios, from legal finance to real estate. That’s why staying up-to-date on the latest trends in the alternative investment world is essential. By doing so, investors can make informed decisions about where to put their money.
So what are some of the hottest trends in alternative investments right now? Keep reading to find out.
1. Access is growing thanks to technological advancements
Historically, alternative assets have been largely inaccessible to the average investor due to the high minimum investment set by many asset managers and the lack of transparency around these investments.
However, technological advancements have led to increased access to alternative assets, as well as increased transparency. These advancements have made it possible for more people to invest and have made it easier for investors to track their investments and monitor performance.
With the help of alternative asset management companies, more investors with a smaller net worth can now invest in assets other than traditional stocks and bonds.
2. Legal finance
As we move closer to 2023, many investors are looking for alternative investment opportunities. Legal finance is one option that is gaining popularity. Legal finance involves investing in legal cases by funding a case directly or purchasing the interest from another party.
There are several reasons why legal finance is gaining popularity as an investment option.
- First, the industry is increasing. The global legal market size estimations reach $1.3 trillion by 2031— the primary growth factors include population growth and the increasing complexity of the legal system.
- Second, legal finance offers the potential for high returns. Investors can earn a return of 30% or more on their investment if the case is successful.
- Third, there is minimal risk involved in investing in legal cases. Unlike other investments, such as stocks or real estate, there is no risk of losing the entire investment if the case goes against the investor.
Decarbonization is a crucial investment trend for the coming years and offers an excellent opportunity for those looking to invest in alternatives. By definition, decarbonization refers to the reduction of carbon dioxide emissions from burning fossil fuels. Decarbonization aims to reduce these emissions to mitigate the effects of climate change.
Given the importance of decarbonization, it’s no surprise that it has been gaining traction as an investment trend. As a result, more and more institutional investors are committing to divesting from fossil fuels and instead focusing on green asset-class infrastructure and emission-reduction investments that will help fight climate change.
4. Real estate
There are several reasons why real estate is such an attractive investment. For one, it’s a tangible asset that can get incrementally improved. Additionally, it offers the potential for both short-term and long-term gain.
There are many benefits to investing in real estate, including appreciation, security, and liquidity. And unlike stocks and bonds, which can be volatile, real estate tends to hold its value over time.
In the past decade, the art market has seen explosive growth, with prices doubling and even tripling in some cases. While many factors are driving the art market’s development, one of the most important is the increasing wealth of high-net-worth individuals.
These individuals increasingly turn to art to store and grow their wealth, helping drive prices up. Additionally, many of these individuals are collectors, which helps to create a robust market for buying and selling art.
Getting ready for the future
Keep an eye out for these trends and be prepared for the future. As investors become more interested in making a difference with their money, they will likely see more growth in these alternative investment categories. So, it’s essential to be aware of these trends and how they may impact portfolios.