Investing

Alternative Investment Options

When it comes to investing, investors look to traditional avenues such as stocks, bonds, real estate and commodities. These avenues are safe, government regulated and potentially lucrative. But for those investors who are searching for something more- especially investments that offer high returns on small capital-alternative investment are worth looking into. Investors should pay attention to three forms of alternative investments in particular: Contract for Difference (CFDs), Spread Betting and (believe it or not) whisky. These forms of investments have been gaining in popularity lately, and they might be a good alternative for those who have extra money to invest.

Contract for Difference
The Contract for Difference (CFD) is a financial instrument that allows investors to speculate on the movement of stock prices without actually owning them (similar to commodities). The investor buys a contract directly from the broker at a fixed price. The investor can profit depending on the difference between the opening and closing price of the contract. They can either go long (buy) if you believe prices will rise or go short (sell) if you believe they will fall. CFDs are useful instruments for hedging your losses in your portfolio. If you have shares that are falling in value, you can use a CFD to profit from the fall in price. CFDs are not just limited to stacks. You can take out CFDs on currencies, bonds, commodities and other financial products.

Spread Betting
Spread betting is a legal form of gambling in the financial industry. Unlike investing, spread betting is simply speculation on the movement of prices over a short period of time. Unlike traditional betting, spread betting is not dependent on the occurrence of a particular event. An investor can cash in at anytime. The broker quotes a price for buying the stock in question (bid price) and will also quote a price when selling (ask price) and the difference is known as the spread. Investors profit depending on the difference between the market price and the bid or ask price. Spread betting is viewed as gambling and therefore not subject to taxation.

Whisky
Alcohol is perhaps one of the lesser known commodities that can offer investors lucrative returns-especially whisky. Whisky has become increasingly viewed as a luxury item, especially by the wealthy affluent population in the East. There is even now an online platform known as WhiskyInvestDirect, which allows investors to buy bottles of rare whisky. Whisky has been a source of fascination for some people and avid collectors will pay handsome sums for it. Scotch whisky has dominated the market for a number of years, but Japanese whisky is beginning to find its niche. A bottle of Kruizawa whisky from 1960 sold for £77 735. That price is relatively small compared to other brands that have sold for as high as $460 000. Recently new distilleries have started listing their first casks for up to 1 million a time, you can see more details on this over at Uisce Beatha.

There are various ways you can invest in the whisky market. You can register online and buy an initial bottle for as little as £2. There is no minimum investment and the investor does not have to store the actual commodity to own it. Storage is done on behalf of the investor. Investors can also invest with funds that will buy and sell on the investor’s behalf.

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