Alternative assets are important because they reduce the volatility of your portfolio and provide unique benefits for the right investors. These investments are often non-correlated to the stock market. This means their performance is not tied to whether the value of stocks and bonds go up or down. Investors use these investments to hedge against inflation and fluctuations in currency and the stock market. Some alternative assets provide tax benefits to reduce the tax burden on an investor's income. Alternative assets also provide an opportunity for investors to use expertise to choose investments that have a strong potential to increase in value. This insight allows educated investors to find hidden gems other investors overlook.