How-To Reduce Risks When Investing in Alternative Investments
If The Investment is Out of Country, Find a Broker.
Emerging Markets are a great place to find alternative investments. Given that, each market has its own set of rules and guidelines to follow. I have found the best practice is to hire a broker who is located in the geographic area of interest, and who understands the marketplace well. This can greatly increase an investor's confidence.
Stay on Top Of Your Investments.
With regards to alternative investments, often times you are the one managing your own portfolio. If this is the case, it is critical that you conduct in-depth research to remain on top of every investment. This is made easier in some industries if you hire an asset manager or some sort of financial planner, but ultimately you must understand that the final decisions are yours. If you don't stay on top of these things, your investments might not turn out the way you had forecast.
Invest in Different Industries.
Do not just leave all of your investment money tied up in 1 or 2 industries. Think about nontraditional investments and create a strategy and portfolio that includes a mix of different industries (green technology for example), while keeping some steady and lower risk investments (like real estate or shipping containers).
Always Seek Out Advice And Testimonials.
One of the best things you can do for alternative investments is to research and ask questions. If you are considering an investment type that you are not familiar with, pick up the phone and call the broker. If they cannot provide you with testimonials from current investors, then use the internet and seek out answers for yourself.
Although you can count on these tips to help you reduce risks when investing in alternatives, it is important that you determine what your threshold for risk is, before beginning your investment search. Once you correctly identify for tolerance, you will know exactly what you are working to reduce.
Posted by Michael Young
Labels: investment risk
An entrepreneur at a young age, I began my first business when I was 9. I would sneak on to the private golf club course and search for lost golf balls in the woods and water. Some days I would find a hundred or more. After taking them back home and washing them thoroughly, I would return to the golf course and sell the balls I had found, a dozen at a time.
The point I am getting at is that I have always found unconventional ways to earn and save money.