The Little Book of Alternative Investments: Reaping Rewards By Daring To Be Different

In The Little Book of Alternative Investments, bestselling authors Ben Stein and Phil DeMuth break down the world beyond stocks and bonds, revealing how investors can diversify and protect their portfolios with alternative asset classes. Written in their signature witty and approachable style, the book makes complex investment vehicles understandable and practical for everyday investors.

Stein and DeMuth argue that the traditional 60/40 stock–bond portfolio leaves investors overexposed to market swings. They present alternatives—such as commodities, real estate, hedge funds, private equity, collectibles, and structured products—that can reduce volatility and enhance long-term returns. Through case studies, performance tables, and accessible explanations, the authors evaluate both the strengths and risks of these unconventional opportunities.

The book also includes a field guide to hedge funds, breaking down ten key strategies from long/short equity and global macro to event-driven and managed futures. For investors who may not have millions to access traditional hedge funds, the authors introduce practical ways to gain exposure through ETFs and mutual fund structures.

By showing how to classify investments not just by asset type but by risk exposure, Stein and DeMuth provide a new way of thinking about portfolio construction. The result is a humorous, insightful, and actionable guide to reaping the rewards of being different in investing.

✅ What You’ll Learn:

• Why the classic 60/40 stock–bond portfolio can be limiting
• How to use alternatives like commodities, REITs, hedge funds, and private equity
• The role of collectibles and other unconventional assets in a portfolio
• Ten major hedge fund strategies explained in plain English
• Practical ways to access alternatives without institutional wealth
• How to classify investments by risk, not just asset type

💡 Key Benefits:

• Makes complex alternative investments accessible and engaging
• Provides both pros and cons of various alternative asset classes
• Helps investors diversify and reduce portfolio volatility
• Includes real-world examples, performance data, and case studies
• Written in an entertaining, easy-to-understand style

👤 Who This Book Is For:

• Individual investors seeking to diversify beyond stocks and bonds
• Beginners curious about alternative investments explained simply
• Intermediate investors exploring hedge funds, commodities, and real estate
• Professionals wanting a concise, witty refresher on alternatives

📚 Table of Contents:

• Introduction
• Chapter 1: Everything You Know Is Wrong – Addicted to Stocks, Bye Bye Miss Portfolio Pie
• Chapter 2: Efficient Market Theory and Its Discontents – Exploiting Market Anomalies, Bonds, Risk-Balanced Portfolios
• Chapter 3: Collectibles as Investments – Love, Buying & Selling, How Not to Make Money
• Chapter 4: More Alternatives We Don’t Love – Private Equity, Buy/Write Funds, Structured Products, 130/30 Funds, Gold
• Chapter 5: Conventional Alternatives I: Commodities – Futures, Uses, Portfolio Value, Investing Methods
• Chapter 6: Conventional Alternatives II: Real Estate – REITs and Applications
• Chapter 7: The Ultimate Alternative Investments – Hedge Funds, Anomalies, Realities
• Chapter 8: Why Invest in Hedge Funds?
• Chapter 9 & 10: Field Guide to Hedge Funds (Ten Core Strategies)
• Chapter 11: One-Fund Solutions and Hedge Fund Replicants
• Chapter 12: Hedge Funds in Mutual Fund Wrappers
• Chapter 13: Adding Alternatives to Your Portfolio – Couch Potato Portfolio & Future Outlook