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What Are the 7 Best Alternative Investment Platforms?

These seven top alternative investment platforms offer exposure to non-traditional assets with high growth potential and portfolio diversification benefits.

last update Monday, November 07, 2022





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By making alternative investments more accessible, online alternative investment platforms have democratized an asset category once reserved for the privileged few. Before the online platforms came along, alternative investment investors had to be more than accredited. They also had to own or rent a storage facility or a massive safe to store assets like art, wine, gold, collectibles, and commodities. In addition, investors assumed the responsibilities of insuring, securing, and maintaining the assets.
Alternative investment platforms have taken the grunt work and added expense out of investing in these alternative assets. Along with portfolio diversity and higher profit potential, these platforms give you many investment opportunities other than online broker securities. Here are seven of the best alternative investment platforms on the internet.

Yieldstreet

Focus: Varied
Investor Types: Accredited investors, except for the Prism Fund
Annual Fees/Minimum Investment: 2.5%/ $2,500
Return: 9.73% net annualized return
Yieldstreet is a very popular alternative investment platform because it offers a wide variety of alternative investment assets, including debt securities, commercial real estate, art equity funds, and many others. Although most of Yardstreet's funds are exclusively available to accredited investors, it offers the Prism Fund to all investors.
Yardstreet offers accredited investors institutional-grade investment opportunities among the most lucrative assets available. However, high-return assets equal higher risk. So, retail investors are better off using this platform as a training ground.

MasterWorks

Focus: Artwork
Investor Types: All
Annual Fee/Minimum Investment: $20 increments
Return: 9% to 15% historical annual return
Masterworks is the best artwork investing platform on the web. It allows all investors to invest in alternative assets once reserved for the extremely rich and powerful. For example, for only $20, non-accredited investors can buy fractional ownership of famous artwork by Monet, Van Gogh, and Renoir.
When Masterworks buys a world-renowned art piece, it holds it for a set period between three to ten years before selling it for profit. After that, the investors split the profit after Masterworks collects 20% and a 1.5% annual fee. Also, an investor can access a secondary marketplace to trade shares.

FarmTogether

Focus: Land appreciation, crop yields, and land rental payments
Investor Types: Accredited Investor
Fee/Minimum Investment: $15,000
Return: 6% to 13% target net annual returns
FarmTogether is one of the best alternative investment platforms because it gives you access to dual sources of return from agricultural real estate. After you buy in, you can earn income from operating yield and receive profits from the sale of the land. Farmland can be an excellent investment for long-term growth. Also, since inflation increases the land value and crop income, farmland is a terrific inflationary hedge. This crowdfunding real estate platform is primarily an accredited investor platform with a few investments for non-accredited investors.

Fundrise

Focus: REITs
Investor Type: All
Annual Fee/Minimum Investment: $10
Return: 10.7% six-year annual average
Fundrise differs from the traditional model of accredited investor platforms by offering the benefits of real estate assets to retail investors without the high investment minimums, long timelines, and low liquidity. Technically, Fundrise is a Real Estate Investment Trust (REIT) that allows you to buy shares in it. In return, you earn quarterly dividends and asset value appreciation.
Fundrise reviews usually point out that Fundrise investors' average annual return was 22.99% in 2021. In addition, REITs have a low correlation to stocks and bonds, making them useful for portfolio diversification.

CrowdStreet

Focus: Private equity real estate
Investor Type: Accredited
Fees/Minimum Investment: 0.5% to 2.5%/$25,000
Return: 18.3% annually
Although it has many competitors, CrowdStreet's stringent vetting process, and comprehensive investment opportunities make it the best alternative investment platform for investing in debt-based assets. However, this popular platform's high minimum investment and low liquidity narrow its pool of investors and potential investors.

Prosper

Focus: Peer to peer lending
Investor type: All
Fee/Minimum Investment: $25 a note
Annual Rate of Return: 5.7% average historical terms
Prosper was one of the first alternative investment platforms to offer peer to peer (P2P) lending. To many observers, it was the prototype that other peer-to-peer platforms copied. This alternative investment platform facilitates loans between a variety of borrowers and an investment pool of Prosper users. For loan amounts between $2,000 and $40,000, Prosper users lend the total or partial amount of the loan to borrowers using a similar criterion to banks, such as credit score, income, and the amount of return from the interest.

Gatsby

Focus: Residential and Commercial Real Estate
Type: Accredited
Fee/Minimum Investment: $10,000
Annual Rate of Return: 26.5% average
Gatsby Investment gives accredited investors access to new developments, renovations, house flips, short-term rentals, and long-term rental properties in the Los Angeles real estate market. With its real estate syndicated structure, Gatsby allows investors to bundle their funds and buy large properties they could not own individually.
Also, Gatsby can help investors generate profits by overseeing maintenance, renovations, and tenant relations. With these benefits, this platform’s low $10,000 minimum can be an excellent motivator to get investors started.

The Best Alternative Investment Platform for You

Alternative investment platforms have successfully exposed more investors to assets once regarded as exotic and hard to obtain. Now that you can buy shares in commercial real estate and fine wines, the question is which alternative investment opportunities are more suited for you.
Some alternative investments offer potentially high returns. But they come with higher risk. Also, some of these platforms require a steep cash commitment. So, your alternative investment platform choice should depend on your financial resources, risk tolerance, and willingness to do your due diligence.

Q& A

Can non-accredited investors invest in REITs?

Investors can diversify their portfolios or earn passive income by buying REIT shares on alternative investment platforms like Fundrise.

How are traditional and alternative investments different?

Traditional investments are SEC-regulated assets like stocks, bonds, and cash. Investors primarily trade traditional investments on well-established exchanges like the New York Stock Exchange and NASDAQ. On the other hand, alternate stocks are unavailable for trade on the SEC-regulate exchanges. As a result, they are more challenging to convert to cash. Alternative investments also lack the transparency of traditional assets. But they generally offer high returns for investors willing to assume higher risks.

How peer to peer lending and crowdfunding platforms differ?

Unlike crowdfunding, peer to peer lending is a loan with specified repayment terms and interest rates. Crowdfunding investors collectively provide capital to business entities in return for dividend income and asset value appreciation.

References

https://www.moneycrashers.com/farmtogether-review/
https://www.yieldstreet.com/statistics/
https://www.forbes.com/advisor/investing/masterworks-review/#:
https://fundrise.com/client-returns
https://investorjunkie.com/reviews/crowdstreet/
https://www.prosper.com/invest-t1
https://www.gatsbyinvestment.com/

by John Burson

Page keywords: accredited investor platforms , fundrise reviews
 



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