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Alternative investments include selling short

Radio Transcript, 60 seconds, for use during week of Dec. 17.

This is an Invest Wisely minute brought to you by Iowa State University Extension.

There are many alternative investments designed for the advanced investor or for someone who uses an advisor.

One example is called selling short.  An investor expecting a stock price to go down can sell a security without actually owning it.  However, if the price of the stock increases there will be a loss for the investor with no limit of how much could be lost.  Selling short has big risks. 

It helps to understand these investments and why they might not be appropriate for the typical investor.

Invest Wisely comes from Iowa State University Extension through a grant from the Investor Protection Trust providing investor education on the web at investorprotection.org.

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Updated December 19, 2007