Alternative investments consistently provide higher returns as well as Essay

Alternative investments consistently provide higher returns as well as diversification benefits to client portfolios Discuss this statement highlighting the most common types of alternative investments - Essay Example e negatively influenced – no matter even the limitation in these products’ performance is high or low; the examination of the investors’ preferences under normal market conditions has led to the assumption that alpha returns is likely to be preferred as an investment tool instead of beta return. The nature and the performance of this investment product can be used in order to explain the increased interest of investors on alpha returns. However, under the influence of the current financial crisis, the attractiveness of alternatives and structured products has been reduced showing the strong dependency of investment decisions on the market conditions. In order to understand the increase in clients’ preferences on alpha returns it would be necessary to refer primarily to the characteristics of the specific investment; in accordance with Dorsey (2007, p.