Alternative Investments

In addition to recommending and purchasing publicly traded securities on behalf of our clients, Labinsky Financial locates and qualifies private investment opportunities for higher net worth individuals.  

For individuals who already hold publicly traded securities in their portfolio, privately held real estate can offer diversification.  Since the value of these assets are largely influenced by local and other economic factors, they tend to fluctuate independently of activities in the publicly traded markets and therefore reduce overall portfolio risk. They may even increase in value as stock markets decline.  

Another advantage of real estate is lower volatility compared to the stock market. While some neighborhoods or properties may exhibit more risk, values will not change drastically in the short term. In some cases, real estate investment can also offer tax benefits, however, this is something you should discuss with your accountant to determine applicability.

Since alternative investments are not regulated in the same way as publicly traded securities and are usually not liquid for a number of years, only those who are considered to be accredited investors may participate. You do not need to be an existing asset management client to participate in alternative investments, as long as you meet the required investment qualifications.  

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Sherrie Banks
Edmonton

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Jerusalem

FAQs

Alternative investments are usually related to real estate projects in the United States.

Our asset management service is available to clients who provide a minimum of NIS 500,000 in cash, or the equivalent in publicly traded securities, for us to manage. With these funds we create a portfolio of publicly traded securities based on the client’s profile. Alternative investments are investments in a private enterprise, usually a real estate project in the United States. The investment amount is determined on a project by project basis and usually requires an investment amount greater than $50,000. Since these projects lack the transparency and oversight of publicly traded securities, and are usually not liquid for a number of years, only clients who are deemed “sophisticated investors” may participate. Investors do not have to be existing asset management clients as long as they are qualified and can provide the required investment funds.

Alternative investments are a way to diversify your portfolio and therefore protect your wealth against various changing market conditions. These investments are usually real estate projects in the United States. As such, values are affected more by local market conditions than activity on the publicly traded exchanges. Another advantage of real estate is that prices aren’t as volatile as the stock market. While some neighborhoods or properties may exhibit more risk, their prices will not change drastically on a short term basis. In some cases, these investments can offer tax benefits, however, this is a matter to be discussed with your accountant.

The concept of the ‘sophisticated investor’ was developed in order to protect the general public from the risks associated with private investments, which lack the oversight, transparency, and liquidity of publicly traded securities. To qualify for these investments, a person must demonstrate either familiarity with the company receiving the investment, or be sufficiently investment savvy. This will be determined at our discretion based on jurisdictional law.