The short answer is that an alternative investment is any investment that falls outside the realm of traditional stocks, bonds and mutual funds or trading strategy that is beyond the conventional long-only or buy and hold. That is, it is considered to be “non – traditional”, even though these investments and strategies have been around even longer than those strategies many consider “traditional”.
Alternatives can be alternative investments (anything other than stocks and bonds) or an alternative trading strategy (anything beyond buying, holding, and rebalancing).
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