An alternative investment is one that does not fall into the conventional categories of investment. Conventional categories of investment include stocks, bonds, debentures, cash, etc. The term ‘alternative investments’ broadly includes tangible assets such as precious metals, art, antiques, and financial assets like real estate, private equity, commodities, distressed securities, hedge funds, exchange funds, carbon credits, venture capital, film production, cryptocurrencies and financial derivatives. Most alternative investment assets are held by institutional investors or high net worth individuals as these investments are complex in nature, lack regulation and involve a high degree of risk. While alternative investments are traditionally for institutional investors and accredited individuals, they have become feasible for retail investors through alt funds, ETFs and mutual funds that build portfolios of alternative assets.
Most of the time, only those deemed as accredited investors have access to alternative investment offerings. Accredited investors are those who have a net worth more than $1 million (excluding their residence) or having a personal income of at least $200,000. Most alternative assets are fairly illiquid as compared to conventional investments. For example, investors are likely to find it more difficult to sell an 80-year old bottle of wine compared to 1,000 shares of a company, due to a limited number of buyers of such items. Investors have difficulty even valuing their alternative investments since the assets and transactions involving them are often rare. For example, a seller of a 1933 Saint-Gaudens Double Eagle $20 gold coin may have difficulty determining its value, as only 13 of those are known to exist as of 2018.
Ares Management Corporation (NYSE: ARES at https://www.webull.com/quote/nyse-ares) is an alternative asset manager in the United States, Europe, and Asia. The company’s Tradable Credit Group segment manages various types of investment funds, such as commingled and separately managed accounts for institutional investors, and sub-advised funds for retail investors in corporate credit markets. Its Direct Lending Group segment provides financing solutions to small-to-medium sized companies. Its Private Equity Group segment focuses on majority or shared-control investments primarily in under-capitalized companies. Its Real Estate Group segment invests in new developments and the repositioning of assets, with a focus on control or majority-control investments. The firm was previously known as Ares Management, L.P. was founded in 1997 and is headquartered in Los Angeles, California. Ares Management GP LLC is the general partner of the company.
Ares Management Corporation’s shares are listed on the NYSE exchange with the ticker ‘ARES’. The NYSE: ARES stock is currently trading for $40.01. The company has a market cap of $9.91 billion. The company reported EPS of $0.38 in the first quarter of 2020. You can do stock trading during stock market hours.
Disclaimer: The analysis information is for reference only and does not constitute an investment recommendation.