Protect your wealth with three alternative asset classes


Note from Chris: As you know if you have money in the markets, stocks have been extremely volatile lately. This is partly because of Russia’s attack on Ukraine… partly because of skyrocketing inflation in the United States…

And it’s partly just that markets are markets.

But that doesn’t mean you should give up on your quest to create life-changing wealth as an investor.

As you will learn today from colleague and former hedge fund manager Teeka Tiwari, there is a simple way to mitigate the effects of all that volatility in your portfolio.

All you have to do is focus on three alternative asset classes. Most people don’t own these types of investments. But as you’ll learn from Teeka below, those who are willing to not only protect their wealth, but grow it…even in turbulent markets like they are today.

If you’re a first responder, police officer, firefighter, or teacher…your retirement account is probably in trouble right now.

According to a recent report by The Wall Street Journalvolatility is eroding retirement savings in US public pension systems.

Public pension funds hit a 10-year median high of 61% of their equity assets as of December 31. A decade ago, that number was 54%, according to Wilshire Trust’s Universal Comparison Service.

And the timing couldn’t be worse. Since Russia invaded Ukraine and the Federal Reserve announced a series of rate hikes…the market is down 13%.

I’m talking about real numbers and real people.

Take California’s public employee retirement system, for example. It is the largest public pension system in the country.

The fund said total holdings rose from $482 billion to $475 billion from January to March. That’s $7 billion in wealth that evaporated in less than two months.

I know it’s hard to hear. And in the short term, things are likely to get worse.

If you’re dependent on public pensions or worried about your portfolio… now’s the time to look to alternative assets.

Volatility is the new normal for the foreseeable future, affecting anyone with money in the market.

With a new environment of higher inflation…potential rate hikes on the horizon…and war in Europe…I expect the market turmoil to continue.

That’s why I always recommend investing in alternative assets that diversify and reduce overall portfolio volatility. Today I’m going to share three that you should add right away…

No. 1 – Bitcoin

Bitcoin (BTC) and other cryptos are the most powerful example of how you can protect your wealth.

Now we know that bitcoin sold off with broader stock markets. But as I showed you last month, it’s a short term correlation.

If you pull the lens back, you will see that bitcoin has been one of the best inflation fighters of any asset.

As I have explained many times, the Federal Reserve can print as much money as it wants. But no one can earn more bitcoins.

In fact, bitcoin’s supply is strictly limited and hardwired right into its code.

This is precisely why you have seen more and more money flowing into crypto.

Smart people realize this is one of the best ways to protect – and even increase – their purchasing power in the face of printing money and rising inflation.

This is precisely why bitcoin has far outperformed any other currency or investment you can think of over the past decade.

Take a look at this recent tweet from Alex Gladstein – a bitcoin advocate who works for the Human Rights Foundation – for a terrific illustration of this:

I first recommended Bitcoin and Ethereum (ETH) to my followers in April 2016.

And they have since returned 10,238% and 28,357%, respectively.

These gains are high enough to combat some of the worst episodes of hyperinflation in history, including even recent setbacks.

If you don’t have bitcoin exposure, use this withdrawal to get some now. I believe it will reach $500,000 in the years to come. So that’s a 10x return on the crypto equivalent of a prime asset.

Use the fear and uncertainty of the crypto market to take advantage of lower prices. And then hang in there as bitcoin hits all-time highs again.

No. 2 – Raw materials

According to Bloomberg, during the first week of March, commodity prices recorded their biggest weekly rise since at least 1960.

And a recent Vanguard study found that for every 1% increase in inflation, commodities rise 7% to 9%.

Summer Haven, an asset management firm, sifted through 50 years of data on different asset classes in varying environments. His goal was to find the best suited assets that offer outsized returns in different inflationary environments.

He found that during periods of rising inflation, the prices of commodity futures rose more than 5 times more than those of US stocks.

And when commodity prices rise, companies whose revenues are tied to those prices tend to do even better.

Take the start of this year…

Metals producer Century Aluminum (CENX) is up 36% YTD (YTD)…potash miner Intrepid Potash (IPI) is up 85% YTD…and oil and gas company RPC Inc. (RES) is up 134% year-to-date Date.

While the broader market is down around 20% over the same period.

If you want exposure to commodities, consider an ETF like the Invesco DB Commodity Index ETF (DBC).

This ETF is a “rules-based” index – meaning its holdings are chosen via an algorithm or data, not a human – made up of futures on 14 of the world’s most traded and important commodities .

(So ​​things like crude oil, gold, wheat, and silver.)

Even after a slight dip in early March, it is still up around 26% since the start of the year.

No. 3 – Private companies

Crypto and commodities are some of the best assets that beat inflation…and they can be a solid defensive play when assets like stocks and bonds are beaten.

But to really balance your portfolio, you can’t stop there… That’s why we also recommend that you diversify into private companies, or what we call “pre-IPOs”.

Pre-IPOs raise funds through a Regulation A+ or Reg CF offering… private funding that is unaffected by public market volatility.

By operating as private entities, pre-IPO companies can methodically execute business plans outside the wild swings of public markets.

The best private companies can also easily build up substantial war chests. Then they can use that money to buy distressed assets on the cheap whenever volatility creates good deals.

Meanwhile, if the market remains volatile, they can stay private until conditions are more favorable to go public.

For all these reasons, studies by research firms like Blackstone and KKR show that private companies consistently outperform the S&P 500.

They also have lower volatility than publicly traded companies…and perform better during tough times.

So with all the volatility we are seeing in the public markets, now is a great time to get exposure to the best private companies.

And recently my team came across a pre-IPO company that found a way to produce oil at a cheaper cost than anywhere else in the world.

More importantly, we think it could help the United States replace oil imports from Russia.

After checking out this private company… a Wall Street powerhouse recently issued a check to become the largest shareholder.

Understand: This company’s trades are some of the most profitable opportunities of the past 150 years…including returns of 47x, 100x and 159x.

This time the difference is that you can also sit at the table.

That’s why on Wednesday, March 23, at 8 p.m. ET, I’m Hosting My First-Ever US Energy Independence Summit.

During this special briefing, I’ll tell you what this company is…the technology it uses to create low-cost energy…and the Wall Street powerhouse that sustains it.

Even better, you learn how you can get shares for just $1.25. Accredited investor status is do not mandatory. But as with all private transactions, actions are strictly limited.

It is therefore essential that you attend. One of my last private deals closed in 12 hours. I expect this deal to go even faster.

Book your place here.

Let the game come to you!


Teeka Tiwari
Editor, Palm Beach every day


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