Alternative Investment Trends in 2025

Alternative investments are growing in popularity as investors seek to add more diversity to their portfolios, spread out risk and pursue higher returns.

Behind this shift are emerging alternative investment trends that are helping to reshape the investing landscape. These trends present investors with opportunities for growth and stability amid changing central bank policies, geopolitical tensions and market volatility. 

Alternative assets, a broad group of investments outside of stocks, bonds and cash, are expected to gain a larger share of the spotlight as the economic environment continues to evolve. If you’re an investor looking for new opportunities, here are some alternative investment trends to watch in 2025.

Alternative Investment Trends in 2025 

As geopolitics, trade, interest rates and regulation evolve, investors who want to remain nimble in their investment strategies can explore alternative investment trends to find opportunities for high potential returns.

With that in mind, here are seven alternative investment trends to watch in 2025.

1. Rise of Sustainability in Alternative Investments

The momentum of investing based on environmental, social and governance (ESG) factors is expected to accelerate in 2025. Impact or ESG-aligned investing aims to generate high returns while making a social or environmental difference.

Regulators and investors are emphasizing sustainability and transparency across alternative assets, such as private equity, venture capital and real estate. Investors may see a rise in investments that target sustainability, such as green bonds, renewable energy funds and socially responsible real estate projects.

2. Growth of Crowdfunding and Peer-to-Peer Lending

Depending on the source, the global alternative lending or alternative financing market, which includes crowdfunding and peer-to-peer lending (P2P), sat between $1.45 billion and $17.72 billion in 2024 and is expected to grow by a double-digit compound annual growth rate over the next few years.

Some of the discrepancies in reporting are due to differences in what research firms consider alternative financing. However, crowdfunding and P2P are definitely on the rise.

These increases are driven by advances in online crowdfunding platforms, technologies like artificial intelligence (AI) and machine learning and the use of social media to market and increase demand for investment opportunities. AI and blockchain technology are expected to fuel future growth in this industry.

3. Emergence of Cryptocurrency and Blockchain 

Cryptocurrency surged into a bull market in 2024, and that momentum is expected to continue through 2025, although potential regulation challenges lie ahead.

Interest in cryptocurrencies and blockchain technology emerged when the U.S. Securities and Exchange Commission (SEC) approved Bitcoin exchange-traded funds (ETFs) in January 2024. Crypto enthusiasts anticipated that the coin's mining would be cut in half – an event that happens every four years – in April 2024, increasing demand. 

On Jan. 23, 2025, crypto had a market cap of $3.69 trillion. Industries across the spectrum, including financial services and banking, data, supply chain, health care, real estate, oil and gas and education, are finding uses for blockchain.

4. Impact of Technology on Alternative Investment Strategies

Alternative investing in hedge funds, private equity, real estate and venture capital was almost exclusively the domain of institutional investors and high-net-worth individuals before technology ushered in an investing revolution.

Technology has democratized alternative investing, opening it to nearly anyone with a computer or mobile device. It has also streamlined processes and enhanced decision-making.

From online trading and investing to AI to crowdfunding platforms to the blockchain, technology has made alternative investments more accessible, efficient, global, personal and transparent.

However, with the increased use of advanced technology for alternative investing, challenges like cybersecurity threats, data privacy issues and regulation have also increased. Resolving those challenges will keep the expansion of alternative investing moving forward.

5. Shift Towards Private Equity and Venture Capital

Private equity and venture capital, long centerpieces of alternative investment portfolios, are anticipated to continue playing major roles in investor strategies in 2025.

Driven by the need for technological innovation in energy, finance and health care, private equity and venture capital investments might soon pour into companies and start-ups developing AI, biotech, clean energy and cybersecurity.

If you want to invest in what’s next in technology, venture capital could provide promising opportunities. Private equity, in particular, could offer opportunities with companies driven by technology or those being transformed by it, such as manufacturing.

6. Rise in Popularity of REITs 

Real estate investment trusts (REITs) allow investors to invest in real estate without the hassle of owning and maintaining a property outright. REITs are companies that own, operate and finance income-generating real estate, such as commercial and residential properties, retail and office space and hospitals.

Designed to provide universal access to real estate investing, REITs pool money from investors (similar to a mutual fund) to purchase and develop properties.

Public REITs, which can be equity REITs, mortgage REITs or a hybrid of the two, are traded on the stock market and pay 90% of profits as dividends to shareholders. They’ve increased in popularity as investors have grown weary of the stock market's volatility and the rise in economic uncertainty.

7. Growing Role of Art and Collectibles in Diversifying Portfolios

As with other types of alternative investing, technology has helped fuel participation in the collectibles market. Online marketplaces have broadened access to various items, and blockchain technology and non-fungible tokens have increased trust in purchasing assets and valuing collectibles.

With the growth in collectibles rising due to the demand for luxury items and their tangible nature, investors have the potential for not only financial returns but also personal enjoyment.

Collectibles like art, sports memorabilia, whiskeys and wines, coins and vintage cars have a low correlation with traditional investment assets, making them useful for portfolio diversification. Market Decipher estimated that the collectibles market will grow 9.2% annually to $484.6 billion in 2024 and continue surging in 2025 and beyond.

Featured Alternative Investments

Consider Getting in on Alternative Investment Trends in 2025

Market watchers predict interest in alternative investments will continue growing throughout 2025, driven by technological advances and additional regulation.

The range of alternative assets is expected to continue expanding, while online platforms and the development of new funds continue to broaden market participants' access. These trends point to alternative assets playing a critical role in investment strategies in 2025.

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