“Curiosity about life in all of its aspects, I think, is still the secret of great creative people” – Leo Burnett
Most people are familiar with the stock market. There are TV stations which have the stock market and stock market related information on 24 hours every day. It is hard to escape it. When the stock market crashes, it makes the headlines in every newspaper, news station, and media outlet. When it reaches all time highs, it is on every magazine cover, even the shoeshine boys are talking about it. But what about other investments?
Huh? There are other investments?
Yes there are investments outside of the stock market. There is no rule that says you have to invest in the stock market, pitting yourself against the best and brightest investors in the world. Investors compound this problem by investing in areas that they are not experts in. Do you think that is a good idea?
Maybe there is a better way to invest…
Can You Invest Outside the Stock Market?
Peter Lynch famously said , “Invest in what you know.” While he was referring to stocks, the concept is sound. If you are an expert in technology then why not apply your knowledge and expertise into your investments. Invest in technology. Don’t invest in horses, or diamond mines. That would minimize your advantage with your investments. This does not mean you should not diversify your investments, rather it means you should take advantage of your particular skill set and expertise and ply it to your investments to make good choices.
While the stock market provides investors easy access to a wide variety of companies, it is somewhat limited to publicly traded companies. These companies cover a wide range of investments: technology, timberland, transportation, real estate, commodities, health care, etc. , but they are still stock shares in companies run by other people.
You could also invest in bonds of these companies. This is also an investment strategy many people and institutions use to invest their capital. It is a good strategy to use, but why stop there? What else can you invest in?
There is a whole world of investments outside the stock market that individuals and institutions invest in. There are no limits to these investments except for your creativity.
What are Alternative Investments?
The term alternative investments requires some explanation due to its lack of definition in popular media. The term alternative investments does not actually refer to any specific group of investments. It is only a descriptive term typically used to describe investments outside the stock market. This includes assets that are also available in the stock market, but available individually. The first investment on the list is a good example of that.