Looking for ways to diversify your portfolio and boost returns? This list of the best alternative investment platforms is a great place to start.
Different financial advisors take different approaches to investing. But the piece of advice that nearly all of them give almost all of their clients is to diversify their portfolio. The logic behind this is simple. Even the best investments go through down cycles, which means putting all your investment eggs in 1 basket is inherently risky. Diversifying your portfolio minimizes the risk that all your investments go south at the same time. One of the best ways to diversify your portfolio is by making alternative investments.
The Best Alt Invest Platforms
- Best for Investing in Rental Homes: Ark7
- Best for Fractional Real Estate: Arrived Homes
- Best for Real Estate Crowdfunding: Crowdstreet
- Best for Student Housing Investors: Collab
- Best for Employers and Employees: EquityBee
- Best for Trading Ideas: Public.com
- Best for Accredited Investors: DLP Capital
- Best for Non-Accredited Investors: Cityfunds by Nada
- Best for Investors Looking for a Diverse Range of Offerings: EquityMultiple
- Best for Diverse Range of Offerings: Yieldstreet
- Best for Real Estate Notes: Groundfloor
- Best for Artwork: Masterworks
- Best for Wine: Vint
- Best for Watches: Bezel
One of the miracles of the internet is how much smaller it has made the world of investing. Before the internet, if you wanted to make an alternative investment in wine or art, you’d have to have a wine cellar or warehouse to store it in. Then you’d have to arrange security and insurance for the investments. It would literally be a full-time job.
But thanks to the internet, there are now dozens of alternative investment platforms where you can pick and choose what to invest in while someone else does the heavy lifting. Some of Benzinga’s favorite alternative platforms are listed below.
Best for Investing in Rental Homes: Ark7
- securely through ark7's websiteBest For:Accredited and Non-Accredited Investors
Ark7 makes money by charging a sourcing fee and an asset management fee on its investments. Its sourcing fee is equal to 3% of the property market cap (determined by the property’s net operating income and dividing it by its value.)
Ark7 serves as a fractional real estate investing platform that wants to make it easier for you to access rental properties. This means that you’re not buying into a REIT or trying to find a specific property to buy. You have control over the properties where your money goes, you can expand or contract your portfolio as much as you like, and it’s available to accredited and non-accredited investors.
There’s no minimum on this platform, there are no commissions for transactions and you can review the portfolio to see what interests you most. Yes, the sourcing fees may seem to be a bit high, but the platform still makes it easier than ever to get into the property sector.
- Fractional real estate investing is an easy way to access a market that can be quite pricey
- This is even easier to manage than investing in a REIT
- You may not want to get too specific with your real estate investments
Best for Fractional Real Estate: Arrived Homes
Arrived Homes is one of the newest and fastest growing crowdfunding platforms on the internet. The company allows non-accredited investors to buy shares in carefully selected rental properties.
The minimum investment is only $100, making it easy to start earning passive income from property investments and to diversify across multiple properties. Investors simply collect quarterly dividends from their properties while waiting for the asset to increase in value over time. Arrived Homes takes care of finding tenants as well as all of the management
- Non-accredited investors can access a marketplace that can be extremely difficult to enter, especially when properties are so expensive
- There’s no need to manage these properties because Arrived is doing the work for you
- You can start small and grow your investment at your own pace
- You may feel as though you don’t have as much information on some of these properties as you might like, giving you a less “hands on” feeling
Best for Real Estate Crowdfunding: CrowdStreet
CrowdStreet is a real estate crowdfunding platform that offers investors the chance to purchase equity shares in various real estate investments around the country. It’s a great way to get involved in property investing, but you must be an accredited investor to buy into any CrowdStreet offerings. That means only investors who pass a certain net worth threshold are eligible.
If you are accredited, CrowdStreet offers some great investment opportunities with the potential for very high returns. The downside is that the minimum buy-ins are on the high side, and most CrowdStreet investments don’t pay dividends for several years.
- You can invest in properties across the country in one place
- CrowdStreet allows you to look into different types of properties and decide what might be best for you
- Only accredited investors are allowed, meaning some investors will be left out
Best for Student Housing Investors: Collab
Collab offer unique investment opportunities, especially in the student housing sector. When you invest in this space, you can hedge your investments against inflation and collect returns. As a decentralized student housing and asset management platform, you can use Collab to invest in these properties. There’s also a community-driven management system that makes it easier for both investors and tenants.
If you’re thinking of using Collab, consider that it provides:
- Access for mid to long-term investors
- Balanced investment opportunities
- Investments with which recent grads may be familiar
- Access to alternative assets
- High cash dividends
- Quality service
- Low minimums
- Low minimums let more people diversify what savings they have and invest wisely
- Collab works with student housing, which is always going to be an issue in large towns or cities where universities welcome tens of thousands of students each fall
- You shouldn’t make short-term investments here expecting make the kind of money you imagined
Best for Employers and Employees: EquityBee
EquityBee is an excellent alternative investment platform, providing investors with access to startups and growing firms. At the same time, startups and companies with big ideas can access retail investors through EquityBee—broadening their reach.
Employees can use the platform to push their stock options back into the firm and take part in its future success.
Investors can use EquityBee to diversify their investments, gain access to companies that have no IPO’d or even make their first investments in the private sector.
By funding employee stock options, EquityBee makes it possible to serve both team members and investors. With a minimum investment of $10,000, EquityBee allows you to get in on the ground level today.
- You can invest in a whole new part of a business that most people forget about
- The minimum is relatively low considering the nature of the investment
- You may not want to invest in something other than employee stock options
- Employee stock option investments can get complicated
Best for Trading Ideas: Public.com
If you want to diversify your portfolio beyond stocks, ETFs, and crypto, you may be looking at alternative assets as a new investment vehicle. Public.com recently launched alternative assets on their platform—meaning you can now invest in art, collectibles, and more right from their app.
You can use the interactive interface to learn more about each asset you choose before buying, and you can track the movement of each asset so that you know your investments are truly performing.
If you’re not sure what to buy or when to sell, you can check out the social feed to learn what other traders are doing. Perhaps they’ll lend you some inspiration.
Plus, there’s a massive educational section where you can learn all about alternative assets and how they should fit into your portfolio. All of this happens on your mobile phone or tablet and you don’t need any investing experience to get started.
- This platform is designed to help you learn and invest slowly, over time
- You can access alternative investments where some other platforms do not offer this option
- Public.com may seem too simplistic for some investors
Best for Accredited Investors: DLP Capital
DLP Capital functions as a private financial and real estate investment firm that allows you access to large cities and attainable workforce housing. The solutions and investment products that are provided both inform and enlighten the individual investor, and the platform as a whole has never missed a payment distribution to investors. Plus, the platform has never lost investor principal.
While the platform is only designed accredited investors, you can expect regular distributions after gaining access to workforce housing projects along with some tax benefits that may come with these investments.
All investments are subject to an intensive screening process, and due diligence is complete on each property just as would be done with a standard investment or property management company.
Every investment is highly liquid, these investments do not correlate with the stock market and allows you to diversify your portfolio even more than before. Plus, all returns are paid to investors before fees are removed.
- The liquidity on the site is rather high considering the type of investments it offers
- The screening on these investments helps you save quite a lot of time
- Workforce housing may not seem like the sort of investment that will grab your interest
Best for Non-Accredited Investors: Cityfunds by Nada
When you invest in Cityfunds by Nada, you can invest in a piece of a city for as little as $250. Anyone can buy into the program at any time with this small minimum deposit, and you are putting your stake into a piece of a city.
The firm invests in residential properties in a particular market, especially high-demand markets like Miami, Dallas and Austin. You can also buy and sell your shares in these cities like stocks so that you aren’t relying on a particular development to see a return.
In short, Cityfunds by Nada combines what you love about ETFs with what is the largest asset class in the world. Plus, you can get yourself on the waitlist for the Nada Card, a debit card that will allow you to earn rewards that you can invest further in your real estate portfolio.
- This platform helps you focus on specific cities that may interest you
- You can diversify within the platform by investing in multiple cities
- Some investors may feel like residential real estate investing is not as lucrative as other sectors
Best for Investors Looking for a Diverse Range of Offerings: EquityMultiple
EquityMultiple is a new alternative investment platform that uses technology to make property investing easier to understand for the investor, especially when you need help choosing the right investments. There are short-term and long-term growth options, and you can make the most of the cash you invest by pinpointing the real estate in which you would like to invest, without buying properties yourself.
In short, EquityMultiple offers:
- Quick returns
- Low buy-in pricing, often less than $10,000
- Excellent client support
Remember, this platform is only for accredited investors, but it allows you to do the hands-on work that you do with your other investments. You can learn all the information you need to know, but you’re never tasked with managing these properties. You simply see the profits when they come in.
- Quick returns help you see what the platform can do for you and if it is worth your time and money
- You can choose from short and long-term investments, depending on your personal strategy
- You may not want to buy in at the level this platform requires
Best for Diverse Range of Offerings: Yieldstreet
Yieldstreet offers an all-in-one alternative investment platform with offerings for non-accredited investors as well as offerings available to accredited investors only. Yieldstreet regularly has new investment opportunities available, ranging from commercial real estate, art equity funds, structured notes, portfolios of consumer debt and many others.
Even if you're not quite ready to jump into one of Yieldstreet's offerings, it's worth signing up for the platform to gain access to the many webinars and educational content available to learn the ins and outs of various types of alternative investments.
- You can choose from several options on this platform
- You can diversify without opening multiple accounts
- You may not feel like the offerings in your preferred category are robust enough
Best for Real Estate Notes: Groundfloor
Groundfloor is an alternative real estate investing platform that offers investments in high-yield, short-term property loans. The platform is open to non-accredited investors and private individuals looking for active real estate alternative investment. Groundfloor has great volume with an average of 50-70 investments available at any given time..
Individuals with small portfolios will also like the low $10 minimum and 0 investor fees. The low minimum investment allows investors to easily diversify their Groundfloor portfolio across multiple loan offerings.
- This platform allows you to get into the real estate market in new and interesting ways
- The super-low minimum is perfect for new investors
- The range of investments, while impressive, may confuse novice investors
Best for Art: Masterworks
This alternative investment platform is based on fine art. It identifies select artists and buys works, which are then registered with the Securities and Exchange Commission (SEC) as a regulation A share offering. Investors will then share in the profits when the artwork they’ve invested in is sold.
Masterworks features works from famous artists both living and dead. In fact, it even has works by Banksy — the pseudonym of the England-based Street artist. This is, however, a long-term investment. Unlike investment real estate, there is no residual income generated by Masterworks investments, and investors must be willing to wait for several years before earning a dividend.
- Art is an excellent long-term investment
- You can access art pieces that would have never known about or could afford
- You may prefer to invest in art you physically own and display
Best for Wine: Vint
Anyone who has ever been to a fancy restaurant and ordered a bottle of wine knows it can be expensive. That’s because wine is produced in finite quantities, and fine wine is in high demand worldwide. That makes it a great alternative investment. Vint allows retail investors to benefit from the price increased caused by this high demand with its wine investment platform.
Vint has the buying power, industry connections and knowledge necessary to gain access to the most sought-after wines on the market at attractive prices before they reach peak value. The company also makes it possible for individual investors to gain access to these wines with a much smaller minimum investment than seeking these bottles out on their own.
- You can turn your love for wine and spirits into a diversifying investment
- You can get in for small minimums, which are akin to the price of more affordable wines
- You may want to invest in wines that you plan to drink. For example, saving nice bottles for special occasions like weddings, anniversaries, graduations, births, etc.
Best for Watches: Bezel
The luxury watch market has been growing of late, and Bezel allows you to enter this market without hunting in antique shops or social media marketplaces. Launched in 2022, Bezel offers a highly curated selection of luxury timepieces from household names like Cartier, Rolex, Tag Heuer, Tiffany and more.
Bezel’s mobile app is just as easy to use as its website, and the catalog appeals to both new collectors and timepiece enthusiasts or even those looking for that one special watch.
At Bezel, you gain peace of mind and get the value you deserve with:
- Digital and in-house authentication of every timepiece before it’s listed for sale
- A range of sellers from private owners to dealers and resellers
- Extraordinary customer care
- Fully insured overnight shipping
- Available warranties (for an added cost)
While Bezel is only available in the U.S., it’s the best way for you to invest in watches, add value to a diverse portfolio, adorn your wrist with some luxury, find the perfect gift or resell a watch that lost its spot in your rotation.
- You can access many styles and brands in one place
- The platform verifies the authenticity of every timepiece so that you don’t need to
- While timepieces tend to not go out of style, you may prefer to own a single, classic watch that you wear regularly
What is an Alternative Investment?
Any investment you make in something outside of stocks and bonds is considered an alternative investment. It may sound exotic but in reality, people have been making alternative investments for a long time. Historically, real estate and gold are 2 of the most popular alternative investments. You can diversify your portfolio by making alternative investments as supplements to your stocks and bonds, or you can have a portfolio that consists entirely of different alternative investments.
Types of Alternative Investments
As discussed in the section above, real estate and gold are 2 of the most commonly held alternative investments. With that said, there is a multitude of alternative investments you can make. Here are some of the most popular options:
- Rental or investment properties
- Precious metals (gold, silver, platinum)
- Cryptocurrencies like Bitcoin or Dogecoin
- Non-fungible tokens (NFTs)
- Collectibles such as baseball cards, historical items and rare jewelry
Diversify With Preferred Alternative Investments
Alternative investments may sound like a fancy, New Age concept, but that’s far from the truth. In fact, if you own property, you have already made an alternative investment. Many people who see the wisdom of investing, but are put off by the volatility of the stock market, have been gravitating toward alternative investments for quite some time. With that said, it’s important to remember that there is an incredible variety of alternative investments outside of real property or even gold. The rise of internet-based alternative investment platforms has opened up a whole new world to potential investors.
Now you can buy shares of startup companies, wine futures and even sports collectibles as alternative investments. Some have high payoffs and an elevated risk level, while others may require investor accreditation and the ability to wait a long time before earning a dividend.
Other alternative investments have an active secondary market that allows you to liquidate your shares quickly. The variety is nearly limitless. Alternative investments can be a great way to diversify your portfolio, but you still must consider the risks and choose wisely. As always, Benzinga is a great place to go for neutral information on all the pluses and minuses.
Frequently Asked Questions
What are some examples of alternative investments?
Any investments made in something aside from stocks and bonds are considered to be alternative investments. Examples of popular alternative investments include the following: gold, real estate, wine, sports collectibles, startups, art, cryptocurrency.
What are the best alternative investments?
The answer to that question depends on several factors, and the answer will vary depending on the needs of each investor. Long-term, accredited investors might like REITs, but there are also real estate offerings for nonaccredited investors as well.
Other investors may already have real estate holdings and want to buy into niche investments that pique their personal interests such as wine or sports collectibles. In all cases, investors have to consider their liquidity and individual risk tolerance before deciding what investment is best for them. What might be right for one, may not be right for another.
Are alternative investments profitable?
Yes, alternative investments can be profitable, but they generate profit in different ways. For example, real estate may generate steady income while wine, watches and collectibles may only generate income when they are sold.
Accelerate Your Wealth
Arrived Homes allows retail investors to buy shares of individual rental properties for as little as $100. Arrived Homes acquires properties in some of the fastest-growing rental markets in the country, then sells shares to individual investors who simply collect passive income while waiting for the property to appreciate in value over 5 to 7 years. When the time is right, Arrived Homes sells the property so investors can cash in on the equity they've gained over time. Offerings are available to non-accredited investors. Sign up for an account on Arrived Homes to browse available properties and add real estate to your portfolio today.