3 Alternatives to Stocks For 2022

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This post contains sponsored advertising content. This content is for informational purposes only and not intended to be investing advice.

Investors who’ve been watching the news might realize the economy is currently experiencing the highest inflation rate in nearly 40 years, volatility is still high from 2020, and the stock market is currently in correction territory. However, the biggest problem has yet to come: The interest rates hikes.

The last time the interest rates rose to 5.25%, the S&P 500 dropped more than 50%. And now, the Fed is planning to hike interest rates 4 times. And it could be worse. In fact, The Feds Chairman Jerome Powell said “if we have to raise interest rates more over time, we will.”
While most people hold their positions through a crisis or sell and hold cash, there are alternatives. Among them is diversifying with alternative assets. 

3 Alternatives to Stocks For 2022 

Alternative assets often have low correlation and may even have the potential to appreciate or retain value during a crisis like we’re seeing now. This means these assets may not be as susceptible to market swings, high inflation, or temperamental volatility, and they could pay off in the long term.

So it’s no wonder why many investors, including the ultra-wealthy, are pouring into alternative assets now. According to Investopedia, the ultra-wealthy understand that physical assets like commercial real estate, gold, and even artwork, can help balance out the volatility of stocks.

1. Cryptocurrency

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In 2017, Bitcoin (BTC) gained mainstream popularity when it exploded from $2,000 to $19,345. And recently, to the peak price of $68,000+.

If investors invested in Bitcoin at its start, they would've seen a 755,554% plus gain. 

Despite the recent pullback, many expect cryptocurrencies to have a bright future as the ultra-rich continue to pile in. For example, Elon Musk's company Tesla purchased $1.5 billion in Bitcoin in 2021. Microstrategy holds over 122,478 Bitcoin worth a staggering $4.4 billion. And Tyler and Cameron Winklevoss reached billionaire status partly by investing in Bitcoin. 

2. Real Estate

Image sourced from Wikimedia Commons

One of the wealthiest Americans in history, Andrew Carnegie, said "Ninety percent of all millionaires become so through owning real estate. More money has been made in real estate than in all industrial investments combined." And due to recent events, real estate has been rising in popularity.

According to the Federal Housing Financing Agency, most home prices increased more than 18% in 2021. And in 2022, some analysts believe it will rise higher. 

While investors could invest in real estate the traditional way (buy, hold, sell), investors can also invest in REITs just to gain some exposure. 

Investors can participate in real estate deals with alternative investment platforms, which allows them to get in deals for as little as $10 to start. 

3. Fine Art

Image sourced from Wikimedia Commons

In 2005, New York art dealers Robert Simon and Alex Parrish bought the Salvator De Mundi painting by Leonardo Da Vinci. They paid just $10,000. And in 2017, a wealthy patron bought it for more than $450,000,000. 

That’s a price appreciation of over approximately 4,490,900% in just 12 years, making this portrait of Jesus the most expensive artwork ever sold.  

Most people think investors need to have millions in the bank to invest in fine art. And while that may have previously been the case, it's no longer true. 

Because thanks to an ingenious platform called Masterworks, investors can invest in million-dollar contemporary artworks alongside wealthy art collectors like Bill Gates, Jeff Bezos, and Oprah Winfrey - for a fraction of the cost of purchasing the whole artwork 

Over 73% of ultra-high net worth Americans, surveyed by UBS, consider buying art to diversify their portfolio. The WSJ recently called art “among the hottest markets on earth.” 

And art generally has a low average correlation to the stock market, the BBC explained. So blue-chip (contemporary) art prices don’t necessarily follow the direction of equity market moves. 

There are over 300,000 members on the Masterworks art investment platform. Sign-up is for free at this link. 

See important disclosures at masterworks.io/disclaimer

This post contains sponsored advertising content. This content is for informational purposes only and not intended to be investing advice.