An Alternative Education

Despite investors' lack of familiarity with alternative investments, new research suggests that they are open to them, if only they are educated first.

The Alternative Investments Investor Survey conducted by Rydex Investments and e-Rewards, which polled 500 individual mutual fund investors in March 2008, found that 63% of respondents who said they are familiar with alternative investments don't invest in them because they don't know enough about them. "There are many misperceptions about what an alternative is," says Dawn Kahler, VP of marketing at Rydex.

Half of those investors surveyed would like to receive more information about alternative investments via an investment advisor, the survey found, and after being given a description of alternative investments, 60% said they would consider investing in alternatives if their advisor recommended it. Given the potential benefits of alternative investments, almost half (45%) of investors surveyed would be more interested to work with a financial professional who offers them.