If you're looking to gain exposure to a variety of securities and assets, it's advisable that you invest in an Alternate Investment Fund. These funds are typically composed of at least one hedge fund, one bond fund, and one money market fund in order to offer investors diversification. However it is not uncommon for these funds to contain other types of investments such as futures and commodities.
Alternate Investment Funds typically pay interest based on their average daily net asset value on a quarterly or annual basis. If you are able to choose the specific assets of the fund, then you may be able to direct your money into certain investments. For example, you may perhaps want to invest in a money market fund that is comprised of U.S. Treasury bills, but instead you decide to invest in an Alternate Investment Fund that contains corporate bonds and short term notes.
There are a few things to consider when purchasing shares in Alternate Investment Funds.
You must be able to afford the full amount of the fund's minimum investment.
The alternate fund's net asset value will most likely always be lower than that of its underlying investments.
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