“If it ain’t broke, don’t fix it.”
“If it’s confusing, don’t bother”
While these sayings hold some truth, if we fully embraced them, progress and innovation would be stifled across the board.
I mention this to introduce you to the world of alternative investments.
When we hear the term “alternative,” it might conjure thoughts of something outside of our comfort zone. However, in the context of alternative investments, we’re referring to:
- Hedge Funds
- Commodities (Gold, Silver, etc.)
- Collectibles (art, baseball cards, sneakers, etc.)
- Many more!
Like many things in business, relationships, or life, we want to make the most out of what we have for as long as we have.
WHY DOES IT MATTER?
Efficiency has become a popular concept in our culture, but underlying this is a belief in the constant potential for adaptation and improvement. This is precisely what we, as investment managers, aim to achieve when we introduce alternative assets into our clients’ portfolios.
The key to facilitating the growth of your money is to harness the power of compounding and minimize interference. The challenge arises when a portfolio experiences frequent fluctuations, disrupting the compounding process.
To fully leverage the benefits of compounding, it’s essential to help maintain an efficient portfolio. This means incorporating different types of risks into the portfolio. Alternative investments offer an advantage in this regard by providing non-correlated assets that historically perform differently than major indexes like the S&P 500.
To help your money’s growth potential, allow it to compound over extended periods. A less volatile environment is ideal for compounding. Alternative investments can help enhance portfolio efficiency by introducing diverse risk elements.
If you would like to learn more, listen to last week’s podcast on alternative investments: https://makingsensewithedbutowsky.buzzsprout.com/share
Or watch our previous webinar on this topic below.
FOR FURTHER CONVERSATION
Alternative investments can feel like drinking from a fire hose. There are vast amounts to choose from, and the risk may be higher than your typical investments. Please reach out if you’d like to learn more.
Chapwood Investments, LLC is a SEC Registered Investment Advisory Firm. No mention of a particular security, index, derivative or other instruments in this material constitutes an opinion on the suitability of any security. The information and data in this material were obtained from sources deemed reliable. Their accuracy and completeness are not guaranteed. At any given time, principals at Chapwood Investments, LLC may or may not have a financial interest in any or all of the securities or instruments discussed in this material. The guests appearing in material do not receive compensation or provide endorsements or testimonials. Past performance is not indicative of any future results.
Investing in alternative assets involves higher risks than traditional investments and is suitable only for sophisticated investors. Alternative investments are often sold by prospectus that discloses all risks, fees, and expenses. They are not tax efficient and an investor should consult with his/her tax advisor prior to investing. Alternative investments have higher fees than traditional investments and they may also be highly leveraged and engage in speculative investment techniques, which can magnify the potential for investment loss or gain and should not be deemed a complete investment program. The value of the investment may fall as well as rise and investors may get back less than they invested.