What are the alternatives to traditional investment? - Baltimore Post-ExaminerBaltimore Post-Examiner

What are the alternatives to traditional investment?

Investing is not an easy call to make. Anyone looking at models of investment practices and for good, and potentially lucrative, opportunities will always have that area of uncertainty as to what will be profitable and what may not be.

In Baltimore, there are wide-ranging options for investors looking to make sound investments for the future and get a good return. Often, investors are looking for a relatively safe market to put their money, though they know they will not necessarily get a high level of return.

Investors who know their way around the financial world will often have some safe bets ­– such as government bonds – and some medium-risk ones with listed companies on the stock market. Many of these can be sound investments, but investors need to look at both long-term and short-term trends in the sectors they want to invest in.

For example, food and drink companies often post good results, so investors can get a decent return for their money. Mining and oil companies can also give excellent returns, but any economic downturn can affect their share price and lose investors money.

Investing is always something of a risk, and the most important thing to consider as an investor is to spread a portfolio. Most investors want to have a degree of security with the money they put in – a backup if other things don’t go to plan ­– but alternative ways of investing that can be high risk but potentially have huge returns are becoming more and more popular.

investments2Looking for alternatives

Many investors tend to go for the traditional asset types. These are stocks, cash, and bonds, and they can certainly bear financial fruit but are considered relatively safe. As anyone who invests knows, values of investments can go down as well as up.

Alternatives for those who want to look for different investment mechanisms include real estate, hedge funds, managed futures, and commodities and commodities contracts.

This is where professional advice is essential. Anyone who takes out a mortgage for a home will want to understand what is involved, in detail, and that’s what a mortgage broker will explain. Similarly, investing in alternatives means the potential investor has to have a clear understanding of what is involved.

The financial world is complex, and though it offers many possibilities to increase wealth, it does have its downsides.

Binary options

This is an important part of investment strategies now, but there is a high-risk factor attached. Binary options are basically a proposition where an investor says “yes” or “no.” It’s actually a very simple way of trading financial assets, but investors should take professional advice from binary brokers before moving into the market.

With binary options, an investor will effectively bet on whether an underlying asset will be above a specific price at a specific time. The answer is yes or no, so it’s definitely a gamble. All investment is a gamble, so if the binary options path is of interest, then it should be part of an overall strategy for investment.

In the end, it depends on how much risk an investor is prepared to take. Binary options mean that it’s effectively all or nothing. Investors can proceed with their own due diligence, as they should, and be sure that what they are investing is what they are comfortable with.

Real estate in Baltimore could be a good investment, but those looking into it need to look at local zoning, local and federal laws relating to new housing and commercial building, and see what opportunities there could be for investment.

It’s always important to keep in touch with what local laws permit and try to work with them in terms of potential investments.

Research the options

Many potential investors don’t have an inside track to the financial world. They may have money built up in savings accounts, through their own real estate, or locked up in pensions. How do they open up their financial options?

Once again, it comes down to doing the research, and in detail. It’s perfectly possible to do a lot of research online, but contacting and talking to a financial professional can make a real difference as to investment options. The financial world is highly complex, and when looking at investment possibilities, it makes sense to ask around and get a feel for what could work.

Alternative investments can work well. Alternatively, they may not. Investors should examine their risk appetite and then decide how far they want to go.

 


About the author

Claire Bolden

Claire Bolden McGill is a British expat who lived in Maryland for three years and moved back to the UK in August 2015. Claire wrote about her life as a British expat on the East Coast and now works in travel and hospitality PR in the UK. She still finds time to blog about her repatriation and the reverse culture shock that ensued - and she still hasn't finished that novel, but she's working on it. You can contact Claire via twitter on @clairebmcgill or via her blog From America to England. Contact the author.
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