YieldStreet Alternatives • Benzinga

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Yieldstreet, the popular platform for alternative investments, can be a great place to find profitable opportunities to diversify your portfolio or simply invest your money in assets aside from stocks, bonds or cash. However, for those who aren’t accredited investors or who are looking for a wider range of alternative investments, Yieldstreet can feel too restrictive. If that’s the case, keep reading to learn a little more about alternative investing and some of the other platforms you can check out to find an opportunity that fits your needs and investment goals.

What is Yieldstreet?

Yieldstreet is an online platform where individual investors can find real estate, art, multi-asset funds and other alternative investment opportunities. When you sign up for an account, you’ll get access to a marketplace of unique offerings, all of which have been rigorously vetted by the Yieldstreet team.

For all that it offers, the key barrier to the platform is the fact that these offerings are generally only available to accredited investors. Accredited investors have to meet certain income and net worth criteria that are simply not practical for the average investor.

The platform does offer nonaccredited investors the opportunity to invest in the Yieldstreet Prism Fund, a multi-asset fund composed of a diverse range of assets spanning 6 asset classes. However, aside from this fund, there’s not much else nonaccredited investors can do on the platform. This is the major reason people look for alternatives to Yieldstreet that do provide regular investors with a way to participate more actively in the exciting and potentially lucrative alternative investments market. 

Why Choose Alternative Investments?

While alternative investments can sometimes take more work and more due diligence to find the right opportunity, they continue to be a popular choice among a wide variety of investors. This is because they can offer a lot of benefits that conventional investments like stocks, bonds or cash simply can’t, namely:

  • Lower volatility. Even if you’ve never traded on the stock market, you’ve no doubt heard about historic crashes or explosive bubbles that seem to grow beyond reason and then pop without warning. Tangible assets like real estate, farmland or companies don’t have that same volatility. While their value can certainly fluctuate, it’s a much more gradual process, giving you time to plan and prepare if you sense a decline coming. 
  • Direct ownership. With the exception of things like crowdfunding platforms or multiasset funds, many alternative investments involve directly buying or investing in a tangible asset that you then own in whole or in part with a few other investors. This gives you more decision-making power and control over how you manage and grow its value. It also means more of the profit generated by the asset goes directly to you.
  • Consistent passive income. Some alternatives, most notably real estate, can provide relatively predictable passive income. When you buy a multiunit rental property, you’re able to collect rental income every month from each tenant — regardless of whether it’s a bear or bull market. 

Who Benefits From Alternative Investments?

While the potential upsides of alternative investments sound attractive, they do often require a larger commitment from the investor, so they aren’t the best choice for someone who wants to put money in and forget about it. They’re a better pick for those who are interested in being more actively involved and who are comfortable with potentially not being able to pull their cash back out of the investment right away.

In some cases, the initial investment can be high. While you can start buying stocks with just a few bucks, you’ll need a hefty down payment and a long-term commitment to buy a rental property. Moreover, that cash you invest can sometimes be tied up for a long time. You can cash out your stocks whenever you like but pulling your money out of, say, an art collection requires taking the time to find 1 or more buyers. 

Alternative investments can also take more of your time. Doing your due diligence at the beginning to make sure the startup you’re considering funding has what it takes to succeed or to vet that farmland you’re looking at flipping or renting takes a lot of research and decision making. Depending on the asset, you may also need to make time for it after you invest. When you buy a rental property, for example, you’ll have to take time out of your week to manage that property. 

Because of the higher level of financial and time commitment required, alternative investments are usually best for those who like the idea of having a more hands-on role in their investments. Managing your rental property or using your art history expertise to build a phenomenal art collection can be incredibly rewarding — and yield great returns, of course. 

It’s also recommended that you only invest as much cash into these alternatives as you can afford to not touch for a few years. Don’t pour your entire life savings into an illiquid asset. Make sure you have some cash set aside to cover unexpected events so that you’re not at risk of finding yourself in an emergency with all your cash tied up in property or another illiquid asset.

Benzinga’s Best Alternative Investments

Whether you prefer more tangible assets or you’re just looking for some good alternatives to add healthy diversity to your portfolio, here are some of our favorite alternative investments:


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Best For

Private Inestments

1 Minute Review

CrowdStreet is a commercial real estate investing platform where people can invest directly in commercial projects. Unlike a brokerage firm, CrowdStreet isn’t a middleman. Instead, the platform acts as a marketplace where investors can pick and choose the best deals for their time horizon and strategy.

Available investments range from family living spaces to office buildings to storage facilities and investors can sign up for a free membership. Your investment options are limited to what’s live on the Marketplace and you’ll need capital to build a diverse real estate portfolio. Only accredited investors can access deals through CrowdStreet.

Best For

  • Investors looking for diversification away from stocks
  • Real estate investors interested in new opportunities
  • Accredited investors with lots of capital at their disposal
Pros

  • Unique opportunities available
  • Makes real estate accessible and understandable
  • Investors can devote capital to both debt and equity offerings
  • Offers quality education materials and answers to FAQs

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