Why Alt Investments
The Problem with Traditional Portfolios
Most investors are “naturally long” stocks, through direct investments, jobs, real estate, and corporate bonds. This creates dangerous concentration risk when markets turn south.
Traditional 60/40 portfolios face unprecedented challenges with bond yields in secular decline and expected returns significantly lower than historical averages.
The Alternative Solution
Alternative investments provide what traditional portfolios lack: different return drivers, lower correlation to stock market movements, and potential downside protection during market stress.
Crisis Performance That Works
During major market downturns, well-selected alternatives have historically provided meaningful protection:
CrisisAlternativesU.S. Stocks2000-02 Dot-com Bust+9.9%-45.6%2007-09 Credit Crisis+16.7%-52.6%
Real Portfolio Impact
Adding alternatives to a traditional portfolio has historically:
- Reduced worst drawdowns by 30%+
- Improved worst 3-year periods significantly
- Enhanced risk-adjusted returns
Beyond the Labels
Don’t get confused by dozens of alternative investment categories. What matters is actual portfolio diversification.
Key Insight: Many so-called “alternatives” still correlate highly with stocks. For true diversification, look beyond the equity cluster to strategies with proven crisis performance.
Meaningful Allocation Matters
Small allocations (2-5%) simply don’t move the needle. To meaningfully impact your portfolio, consider allocations of 15-30% based on your specific objectives.
Partner with RCM Alternatives
With over two decades of experience, we build alternative investment portfolios through a disciplined process:
Scout Talent:
Proprietary filtering identifies promising managers
Deep Research:
Rigorous due diligence separates skill from luck
Custom Solutions:
Tailored portfolios matching your goals
Seamless Implementation:
Flexible structures from individual accounts to funds