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3 Investments That Can Help Broaden Your Portfolio

“Alternative” is much more than that angsty teen phase you went through in high school. On the contrary, Maggi Tax is highly interested in sharing alternative investments that can provide your portfolio with unparalleled diversification. These out-of-the-box financial ideas may offer exposure in several areas that can guarantee a broadened portfolio is within reach.

Though financial barriers to entry can be higher than other investments, these unique selections can include anything outside the financial asset mainstream. Think collectibles to modern buildings to raw materials. Wading into this pool may seem like a straight-up thrill ride since these investments are largely unregulated by the SEC. We recommend proceeding with caution, so the risk doesn’t outweigh the reward. For example, if you purchase a piece of art but discover it is forged and cannot locate the seller, that loss is yours alone. Here are three ways to get started with alternative investments.

1. Real Estate

This is the most common type of alternative investment. Real estate investments can produce profit in three ways: through rental income, increased property values, or royalties from any discoveries made on your land. Collecting rent and flipping houses tend to be the most reliable ways of increasing capital but be sure not to overextend yourself. There are alternatives to direct ownership like a real estate investment trust (REIT) that is publicly traded.

2. Collectibles

Not exactly an episode of Pawn Stars but the options are endless for this alternative investment. Tangible items like jewelry, art, coins, vintage cards, fine wines, and more can appreciate over time. However, your ability to profit depends entirely on your ability to locate a buyer. Most sales are kept confidential so there is no data-driven way to determine price or predict what will be a la mode. Should you choose to invest in this area, make sure you consult an expert when it comes to collectibles.

3. Private Equity

This alternative investment refers to capital that can be shuttled into privately held companies or partnerships as a future investment or as part of a reorganization tactic. Investors may purchase parts of a company during high-risk stages through angel investing or even assist with expansion or restructuring through venture capital.

Whatever path you choose, we are here for you. For over 30 years, Maggi Tax has guided Tampa Bay residents with all aspects of their financial well-being. Contact us here or call (727) 799-1701 to schedule your appointment today.

 

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