Which of the following is considered an alternative investment?

Commodities are considered an alternative investment because they fall outside the traditional asset classes of stocks, bonds, and cash. Alternative investments encompass a wide range of financial assets that are not typically classified as traditional investments, and commodities fit this definition well.

Commodities, such as gold, oil, and agricultural products, have unique risk and return profiles compared to conventional investments. They tend to be influenced by different factors, such as supply and demand dynamics or geopolitical events, which makes them attractive for diversification in an investment portfolio. Investors often look at commodities to hedge against inflation or currency devaluation, adding to their role as an alternative asset in financial strategies.

On the other hand, stocks, bonds, and cash are heavily traded and closely monitored assets, usually offering different degrees of risk and return that are well-understood and commonly utilized in investment strategies. They do not fit the criteria of being alternative investments due to their traditional nature and higher level of market integration.