Using Alternatives in 2017’s More Volatile Markets

Using Alternatives in 2017's More Volatile Markets

You can insure almost everything in life. You can protect yourself against the unexpected with health insurance. You can protect yourself against the uncontrollable with trip insurance. You can even protect yourself against the bizarre—like Julia Roberts, who purportedly insured her iconic smile.

But despite all that, you can’t protect yourself against a downturn in the economy. This is one reason I recommend a long-short strategy—because then you’re not relying on market direction to help generate return. That’s a beneficial approach in environments like the one we find ourselves in now; in fact, a rising interest rate environment is actually beneficial to certain types of alternative strategies.

Hear more about investment approaches you might consider in the video below.

 

The opinions expressed are those of Cleo Chang and are no guarantee of the future performance of any American Century Investments portfolio. For educational use only. This information is not intended to serve as investment advice.

Alternative mutual funds often hold a variety of non-traditional investments and often employ more complex trading strategies than traditional mutual funds. Each of these alternative asset classes and investment strategies have unique risks, typically making them more suitable for investors with an above average tolerance for risk. Investors should fully understand the asset classes, investment strategies and their risks before investing.