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Alternative Assets

The following is a list of some, but not all, alternative asset classes. Included in each description is at least one instrument used by investors to make accessing the particular asset less cumbersome (versus investing directly in the asset).

Commodities

Basic goods, with little differentiation from one producer to another. They are most often used as inputs in the production of other goods or services. Examples include grains, gold, beef, oil and natural gas. While commodities are often bought and sold through spot purchases, which are immediate delivery for cash transactions, they are most often traded using futures contracts on exchanges like the Chicago Board of Trade (CBOT ).

Currency

Investors may hold a certain currency in anticipation that it appreciates in value in relation to the other currencies. One of the most popular ways of trading currency is still a spot transaction, which is an outright exchange of one currency for another.

Real Estate

Investment in real estate, whether commercial, retail or land, is done with the expectation that the property will increase in value or that rental income may provide a stable stream of revenue. Some investors find Real Estate Investment Trusts (REITs) a more convenient investment vehicle than direct investments. REITs provide the opportunity for investors to buy shares in a company that purchases (and often manages) a large portfolio of real estate.

 

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The alternatives strategies and asset classes mentioned are not suitable for all investors. Many alternative strategies use sophisticated and aggressive investment techniques such as leveraging, short selling and derivatives. The more you invest in leveraged instruments, the more the leverage will magnify any gains or losses on those investments. The use of short selling involves increased risks and costs. You risk paying more for a security than you received from its sale. Theoretically, stocks sold short have the risk of unlimited losses. The use of derivatives such as futures, options and swap agreements may expose an investment to additional risks that it would not be subject to if you invested directly in the securities underlying those derivatives. Additionally, certain alternative strategies tied to hard assets such as commodities, currencies and real estate, may be subject to greater volatility as they may be affected by overall market movements, changes in interest rates or factors affecting a particular industry, commodity or currency, -such as droughts, floods, weather, livestock disease, embargos, tariffs and international economic, political and regulatory developments. No investment strategy can guarantee a return in a declining market. Additionally, an investor could lose all or a substantial amount of their investment. For more information about these strategies and their risks please consult your financial advisor.

This material is not intended to be a comprehensive overview of the subject matters discussed. It is intended to be general in nature and should not be construed as investment advice or a recommendation of any specific security or strategy. Before investing in any of the investment products or strategies discussed, consult with your financial advisor to determine if they are appropriate for your objectives, risk tolerance, income level and investing time horizon.

Rydex SGI offers funds with investment strategies similar to those referenced on GetAlts.com.

Read the fund's prospectus and summary prospectus (if available) carefully before investing. It contains the fund's investment objectives, risks, charges, expenses and other information, which should be considered carefully before investing. Obtain a prospectus and summary prospectus (if available) at www.rydex-sgi.com or call 800.820.0888.

Rydex|SGI funds are distributed by Rydex Distributors, LLC (RDL). Security Investors, LLC (SI) is a registered investment advisor, and does business as Security Global Investors® and Rydex Investments. SI and RDL are affiliates and are subsidiaries of Security Benefit Corporation, which is wholly owned by Guggenheim SBC Holdings, LLC, a special purpose entity managed by an affiliate of Guggenheim Partners, LLC, a diversified financial services firm with more than $100 billion in assets under supervision.

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