Updated: March 24, 2023
When it comes to investments, the stock market, mutual funds, bonds, and cash deposits are what most people first think about. However, if you’re looking for investment alternatives, what options do you have?
If we’re in the U.S. or a country with a mature financial market, then the list of alternative investments would be led by hedge funds, managed futures, commodities, derivatives contracts, and many other paper assets.
But since these don’t exist yet or are not as easily accessible if you’re in the Philippines, then you can just instead consider the following products and assets to invest in.
1. Exchange Traded Funds
Imagine a mutual fund that’s being sold in the stock market — that’s the closest analogy to describe what an ETF or Exchange Traded Fund is.
ETFs are a good alternative to Index Funds because they carry the same risk and long-term growth potential. If you want to learn more about how ETFs work, then you can read this simple explanation that I wrote before.
2. Paintings, sculptures, and other works of art
This type of investment is only recommended to those who are into art in the first place. Because you need to know which pieces are good to buy, and also how and where to sell them later for profits.
A friend who invests in paintings says that it could take years before an artwork appreciates. He suggests that you’ll earn faster by going to exhibitions and auctions and buying undervalued pieces that you can easily sell.
3. Collectibles and other rare items
Similar to works of art, collectibles such as antiques, toys, coins, comic books, and stamps can fetch thousands and even millions of cash if you stumble upon a rare find in good condition.
Just like art, you need to know a bit of history to make money. Knowledge of specific collectibles will make it easy for you to find rare and expensive items in bazaars, garage sales, auctions, and antique shops.
Are you into toys? Then read this: How to Make Money From Toy Collectibles
4. Intellectual property
Royalty income is passive income. So if you have talent in music or writing, then you can invest your time in writing songs or publishing books.
On the other hand, if you’re a scientist, engineer, or just someone who likes tinkering with stuff, then maybe you can come up with an invention that you can patent and sell. And sometimes, those ridiculous ideas you have could actually be worth millions — just Google “Pet Rock” and you’ll know what I mean.
Lastly, in today’s proliferation of mobile technology, you can also invest your time and resources in creating apps and developing mobile tools that you can sell. Maybe, you’ll come up with the next “Flappy Bird”.
5. Office space rentals
When it comes to real estate, many go for houses and lots, condominiums, and apartments. However, there’s an underserved market for affordable office space rentals that micro and small businesses need.
Most people start with home-based businesses, but as these ventures start to grow and hire their first few employees, they will need office space. And this is where you come in.
Virtual offices has grown significantly in the country over the past few years. But there’s still a big opportunity out there, especially in provincial urban cities.
6. Company cooperatives
If your company has a savings and loans cooperative, then it’s a good idea to consider becoming a member and investing a portion of your salary there.
You’ll enjoy benefits, such as low-interest loans and discounts on partner establishments, but you can also receive dividends that are at par with the income of most investment funds.
7. Crowdfunding investment opportunities
There are now crowdfunding cooperative enterprises in the country, which allow you to invest a small amount of money to become part-owner of a business franchise, a farm business, and many others.
However, always be careful. Make sure they’re licensed to accept investments. An SEC registration only proves they are a legal entity, but it doesn’t automatically mean they can solicit investments. There’s another license for that, which they must have.
Moreover, do due diligence on the businesses or farms that they’re investing in. Make sure that they’re actually profitable and they will be managed by a competent organization.
8. Private equity and debt placements
My cousin’s company wanted to expand its operations several years ago. At that time, instead of getting a business loan that will incur debt interest, they just offered stock options to family and friends.
I was one of those who invested and have been enjoying passive income as dividends ever since. There could be similar opportunities that are available for you.
Startups are growing in the country. While you may not have the time and skills to build one, you can still participate by becoming a venture capitalist or seed investor.
9. Hospital stocks
Speaking of private equity, one alternative investment opportunity that you can seek is hospital stocks. These are usually offered to doctors, but a few are open to the public.
You actually just need to buy one hospital stock, and you’ll immediately enjoy benefits and significant discounts on medical services from the specific hospital. And of course, you’ll receive regular dividends too.
10. Long-term healthcare
Because most financial emergencies are medical emergencies, then it makes sense to invest in long-term healthcare products to provide financial support for your health as you grow old.
These are not the same as your short-term healthcare from your company’s HMOs. It is a complementary product that combines health insurance, life insurance, a savings fund, and investments in one product.
One of the top providers of long-term healthcare in the country is IMG or the International Marketing Group, which I am a member of.
The forex or foreign exchange market offers a lot of opportunities to make money for short-term traders. However, there are also ways to make money in currencies if you can afford to be in it for the long term.
Among those strategies is position trading, which is best described as a long-term trade that lasts for several months. Other buy-and-hold strategies include carrying trading, mirror trading, and opening a managed account.
This is a high-risk venture and I don’t recommend that you go into it without acquiring the proper knowledge first. If you’re interested to try investing in the forex market, then you can sign up for XTB.
And lastly, one of the best investments you’ll ever make is increasing your financial quotient. Take courses, attend paid seminars, buy books, etc. — these are not simple expenses, but investments that will help you make more money in the future.
When you invest in knowledge, you acquire information and skills that will make it easier for you to spot opportunities, understand how investments work, and optimize your strategies.
This list of alternative investments is meant to show you how you can diversify your portfolio beyond the more popular types of investments. This means I’d still recommend having stocks, bonds, pooled funds, and cash deposits.
And as always, there’s no such thing as the best investment. Because the best investment will always depend on your goals. So define your financial objectives first before investing.
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Do you have any tutorial or more info on how to start investing in Hospital stocks?
I’m interested to know more about that stocks. I remember reading it in one of your posts before but still not discuss more about it.
Hi Cristy, none as of the moment. But that article is already in my drafts. I just need to do some more research about it. Thanks.
Hi Fitz. I learned a few good things from this post. I never thought of paintings and rare items as investment possibilities (not that I could afford that kind of investment now). I am interested about Philcrowd though. Do you have any personal experience with this crowdfunding cooperative? Can you share a little more about it also?
Hi Fitz, I’m curious about Philcrowd. Are you also part of that? Can create a post with more information about Philcrowd? I’m a regular employee looking for a 2nd source of legit income.
[…] here to read about more alternative […]
Thank you for what you have shared. Excellent content!
[…] if it’s your first time, or you’re already aware and planning to put money in this alternative investment, I hope this article will give you a better understanding of what investment crowdfunding […]
I would add #13, invest in your own business. I am not suggesting put all your money in one basket, a one-shot deal of a start-up that may face headwinds or even failure. I am suggesting that if you own an established business that is running well and is profitable, why not invest extra money into that venture? I have done exactly that with our family business. Recently, for the benefit of our four troops, I made an additional investment into the venture my beautiful bride operates. The money will stay put, compounding as profits are reinvested. We did exactly that with the original investment in our business after my wife began because we have three other regular sources of income. We let the business grow with zero withdrawals and compounded all profits. It worked so well that I made the additional investment for our children to leave as a legacy to them.
ETFs, YES for sure. LOW ANNUAL FEES on ETFs will put the high fees on mutual funds, UITF funds etc to shame. It is sad how people pay big bucks in annual fees and yet so many fund managers can not even equal the performance of their benchmark index. Most folks would be far better off investing in an index ETF like SPY, IWM or DIA in the US or when the market turns up, use FMETF here in the Philippines. I use ETFs all the time as a trading instrument in my US accounts. Large high volume ETFs are great for option writing also. With the market taking a beating now (February-March 2020) I am turning my attention to scaling into FMETF in the accounts we established here in the Philippines for my wife and our young troops. My thought is that even one single board lot in their individual accounts will motivate the kids to regularly check the market. If the plunge continues, additional board lots may be purchased on the cheap. Normally I do want to “catch a falling knife” but you must do so when scale trading. I do think building the discipline to stay with it is important and I have little doubt that the Philippine economy will rally again one day.
[…] Read next: 12 Alternative Investments To Consider If You’re Looking To Diversify Your Portfolio […]
Which hospitals are open for stocks investment?