What are alternative investments?
Answer: Alternative investments are assets or strategies outside traditional stocks, bonds, and cash, including private equity, private credit, real estate, infrastructure, commodities, amongst others. They may offer diversification, income, or growth opportunities, but often involve greater complexity, higher fees, limited liquidity, and risks that differ from those of traditional investments.
By Edward Papier, CIMA, CF2, CM&AA ยท Last updated November 5, 2026
What counts as an alternative investment?
The category is broad. It includes private credit, private equity and real estate on a primary and secondary basis, direct and co-investments, venture investing, direct secondaries, aircraft, equipment and cargo shipping leasing, multi-alternative, general partner interests, litigation finance, energy, merchant cash advance and other special situations.
Is the 60/40 portfolio still good?
For many investors, the traditional 60/40 portfolio may no longer be appropriate. For decades, stocks and bonds were considered the foundation of diversification. Today we are in a very different environment, with higher volatility, shifting interest rates and structural changes in global markets. Many institutional investors are increasing their allocation to alternative investment strategies such as private equity, private credit and real estate.
What are illiquid investments, and are they worth it?
Illiquid investments cannot be sold quickly at a quoted price the way a public stock can. Many private investments ask you to commit your money for a set period, anywhere from one to ten years depending on the strategy, in exchange for the potential opportunity to generate higher returns. Illiquidity should be judged against your own plans: how much of your wealth you will need access to, and when.
What is a non-correlated asset?
A non-correlated asset is an investment that behaves differently from the stock and bond markets, especially when those markets are stressed. That is what true diversification means: owning hundreds of stocks is not diversification if they all move in the same direction with market forces. Real diversification often comes from asset classes with little correlation to public markets.
When I recommend it, and when I don't
The real challenge today is not access. It is educating yourself and understanding how these investments work. I look forward to helping you climb the alternatives learning curve. It is steep but not insurmountable.
Talk to us
To talk through your own situation, please call 212-697-3930, email ep@amadeuswealth.com, or schedule a meeting at calendly.com/ep-awa.
Edward Papier, CIMA, CF2, CM&AA
President, Amadeus Wealth Alternatives, Hackensack, NJ
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