When does an “alternative investment” become a “conventional investment”. Or maybe more important, who decides it?
My theory is that main stream media decides what should be considered alternative (i.e. less than 10% of your portfolio) and what should be considered conventional. I suspect if the exempt market threw the amount of advertising dollars at media that the conventional mutual fund industry does, it would quickly become more mainstream.
The exempt market is a growing segment of the financial industry. As per the EMDA, the exempt market raised $140 billion last year. I’m not sure with those numbers, an “alternative” moniker is warranted.
From strictly a common sense perspective, should real estate, which makes up a large part of the exempt world, be considered “alternative”? I don’t remember reading in the Old Testament where Solomon or Abraham invested in mutual funds. I do recall, however, quite a bit written about land ownership. History has taught us that real estate, whether its land or buildings, if purchased wisely, has proven to be a worthwhile investment.
Clearly the exempt market is burgeoning. Will it take over the mainstream financial industry? Maybe, maybe not. But do me a favour, if you are referring to the exempt market, don’t call it an alternative investment industry.
Marty Gunderson is a self proclaimed Exempt Market geek. He has served in a variety of leadership positions in the industry, from sales to issuer to dealer. He is the founder of www.BetterReturns.ca, a site that highlights a few quality exempt market offerings. To contact Marty, please email marty (at) idealeader.ca