There are several positives and negatives to consider with alternative investments.  The pros of alternative investments include diversification, the potential for high returns and a way to hedge against inflation. Nevertheless, you also assume a higher level of risk with most alternative investments. They’re not as liquid as stock investments, and their value is often hard to nail down.  Alternative investments can have a high barrier to entry, both knowledge-wise and financially. Certain opportunities, such as tax liens and mineral rights, can be very complex.