Modern investing has become far more diverse than it used to be because today, there are more investment products, asset classes, and opportunities than ever. While the stock market is an excellent, time-tested market to invest and trade in, it is often stressful, psychologically taxing, intangible, out of control, or simply dull and boring for many people.
Whatever your reasons for disliking the stock market, you may be looking for alternatives. These are some stock market alternatives to consider the next time you want to invest in something new, unusual, or even if you simply want to diversify your investment portfolio.
Despite the occasional crisis, real estate has been, is, and most likely will continue to be one of the most reliable investments you can make. You can usually find great real estate investment opportunities in most urban areas and rely on them to grow at a healthy rate over time.
If you are a homeowner, investing in your home is a great idea, especially if you plan to sell soon in a booming market. When done correctly, additions and renovations like decks, pools, bathrooms, etc., can pay off well at the time of sale. You could also simply refinance your mortgage if the interest rates are low and make a decent return on your mortgage over time.
Peer-to-Peer (P2P) Lending
Peer-to-peer lending is a relatively new alternative to the stock market. There are plenty of P2P lending platforms that allow you to lend money and earn interest.
These platforms minimize the risk of defaulters by only lending a limited amount of your total investment to individual borrowers. They essentially diversify your investment to give you a comparable return to the stock market over time.
Investing in commodities like precious metals, natural gas, oil, or even grains and beef is a decent alternative to investing in the stock market. However, it is only good for the diversification of your investment portfolio because commodities do not distribute cash and are commonly considered risky.
Virtual currency is hyped up these days, which may scare most investors. However, crypto trading and long-term investing can make you significant profits. Try to invest in known and reliable cryptocurrencies and avoid them completely if you are easily scared by volatile markets.
Art, Antiques, and Rare Memorabilia
Collecting art, antiques, or rare memorabilia is not just a hobby. It is a great stock market alternative for investors. Depending on market sentiment, these collectibles can rise in value faster than any asset you own.
Some rare collectibles can fetch unreal prices in open markets and at auctions. A passion for collecting such things can pay off big over time, and so can investing in them.
Sports cards are also collectible items that serve as a great stock market alternative for investment. Growing demands, reliable authenticators, and grading services like the PSA have driven the market for rare and mint condition sports cards, allowing certain cards to fetch millions of dollars at auction.
Investing in private equity can offer excellent returns. You should consider venture capital, where you can invest in private businesses directly. Or you could go the entrepreneurship route and start a business on your own or with a partner or buy an existing franchise.
While not the most conventional stock market alternative, investing in yourself is one of the best uses of your money. Consider acquiring skills, certifications, degrees, or other qualifications that help you excel in your career or field. Finding a suitable course has never been easier, and there are millions of online options as well.
These are just some of the main stock market alternatives available today, and there are plenty more that we can discuss another time. For now, consider the ones mentioned and invest in the ones you feel are better suited for you.
You can start with as little as $1,000 and start seeing some good returns within 12 months. Of course, we always recommend diversifying and not putting all your eggs in one basket.