What is an alternative investment and how do they differ from traditional investments

FinanceTrading / Investing

  • Author Paul Dexter
  • Published March 9, 2012
  • Word count 631

Traditionally the type of business or area that attracted investment was limited to certain types of products such as commodities , bonds, cash, property, the stock market and currency exchange ( also known as Forex trading) but in recent year especially since the worldwide recession and the collapse of a number of large banks and financial institutions the type of product attracting investors large and small has change and investor are investing their hard earned cash into what has become known as alternative investments.

The term alternative investment is a comparatively loose one that may include a number of tangible resources such as fine wine, modern or contemporary art, rare coins or stamps , bio fuels such as Jatropha oil, Carbon Credits and a different type of property investment such as short term ethical property investment where the investment not only gives the investor a quick ROI ( return on investment) but helps out with housing shortages in the poorer parts of the world.

Set out below is a brief summary of the most popular alternative investments around at the moment

Carbon Credits

Trading in Carbon Credits has become very popular over the past few years and seen a green ethical investment, Carbon Credit trading has evolved as a way of reducing the quantity of greenhouse gas that is released into the atmosphere. Most industrial countries have their very own emission reduction targets to achieve, caps have been placed on industries on the amount of pollution they are allowed to release.. If a company produces more greenhouse gases than they are permitted they will need to source carbon credits to offset their emissions.

Jatropha Bio Fuel

Jatropha oil is the documented leading second generation Biofuel and it is produced from the Jatropha Curcas Tree. This eco friendly oil is highly efficient, environmentally sound and it provides an extremely attractive return on investment.

The demand for alternative fuels such as biofuels and particularly Jatropha oil is growing especially in this era of increasing fossil fuel costs and ever depleting . biofuels offer increasingly rewarding sources of energy. some say investing in Bio Fuels is investing in the Future

Social Housing

A popular ethical alternative investment a the moment is Brazilian social housing or Minha Casa Minha Vida ( My House My Life) as its know in Brazil, this is a government scheme now in its third year and offers short term investment into property where your investment is used to build a property and you get your return once its built and sold which is usually within 12 months, there are 1000's of Brazilian families on the waiting list so the investment is sound and secure especially when investing direct with a developer and not through a third party investment company. Even though the project is in Brazil you can invest through UK developers such as the award winning EcoHouse Developments when you rcovered by UK law and fund are held in a Lloyd TSB escrow facility

Pension Investments

With interest rate low and banks offering zero or worse gain on pensions fund its now becoming increasingly popular to take your pension funds whether current, dormant or frozen and invest them elsewhere. regulations have changed recently and now you can have more control over where and what your pension is invested into.

When looking at alternative investment you will probably have noticed the term SIPP approved, this mean the HMRC has approved this investment for the use of pension funds meaning you can invest all or part of your pension fund into a SIPP approved investment and get great returns so such as Self Storage Investments offer a monthly income.

SIPP approved also means that the government has look into the investment and deemed it safe and secure. so biol fuel and carbon credit investment are also SIPP approved

Alternative Investor News bring you all the Alternative Investment News and Opportunities from around the world including impartial advice on the best Alternative Investments and other SIPP Approved UK Investments.

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