How do alternative investments differ from traditional investments?

Alternative investments are investments that are outside of traditional investments, such as stocks and bonds, and include things such as real estate, fine art, private equity, hedge funds, and commodities. Unlike traditional investments, the value of alternative investments may be harder to determine. They can also involve a high degree of risk since the alternative investments may be more volatile and may not have the same kind of regulations in place to protect an investor. Alternative investments may also involve a larger initial investment compared to traditional investments. In Washington, the state has a law regarding alternative investments that seeks to protect investors. This law requires that anyone selling alternative investments must provide information about the investment in a way that is easily understood and must also explain the risks associated with investing in the asset. Additionally, the law offers protection to investors should they suffer a loss due to an alternative investment, although additional protections may depend on the investment itself. Overall, alternative investments are investments that are not traditional and involve additional risks and considerations that traditional investments do not. Knowing the law in Washington regarding these types of investments can help investors make informed decisions about their investments.

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