How should I use alternative investments?

Investors today have broader access to alternative investment options than ever before. And while specific alternatives have different characteristics, in general they rely less on markets and more on investment selection for returns, which can make them effective diversifiers.

Alternatives should act as a complement to your existing investment portfolio, not a replacement. As they provide diverse portfolio outcomes, alternatives can be used in different ways, such as to reduce a portfolio’s interest rate risk or to earn a return premium over public markets.

How do I choose the suitable alternatives?

Investors should select alternatives that align with their personal goals. Commonly cited objectives include the following:
Help mitigate the effects of stock market volatility
Help mitigate the effects of stock market volatility
Lower correlations to traditional asset classes
Lower correlations to traditional asset classes
Invest capital longer for higher return potential
Invest capital longer for higher return potential
Hedge portfolio against inflation or rate changes
Hedge portfolio against inflation or rate changes

Integrating alternatives into an investment plan:

Content vs. containers

The choice of investments available is growing, and with it, the potential to find greater diversification.

Learn more


Why BlackRock for alternatives

Our scale helps us deliver sourcing, performance, and solutions that aim to help clients achieve their objectives.

  • Experience: We have managed alternatives for over three decades, with the launch of our first alternatives fund in 1981.
  • Strong sourcing: Our scale enables portfolio managers to source a broader range of investments, influence better terms, and negotiate better pricing.
  • Differentiated performance: Our information advantage results from combining our deep talent bench across asset classes and technology to obtain investment insights.
  • Breadth of solutions: Our deep expertise and experience managing liquid and illiquid alternatives can help investors achieve desired outcomes.

 


How to buy alternatives

If you are considering investing in alternatives, identifying a partner with the resources to support you in your decision making process is important.

Talk to your financial advisor today to understand how alternatives can benefit you!