Alternative assets — anything outside traditional stocks, bonds, and cash — are marketed as portfolio diversifiers and return enhancers. The reality is more nuanced.

I-Bonds (Series I Savings Bonds): government bonds with returns tied to inflation (CPI). Currently paying ~5% (rate adjusts semi-annually). Limit: $10,000/year per person. Cannot sell for 12 months; 3-month interest penalty if sold before 5 years. Best use: inflation-protected savings for money you won't need for 1-5 years. One of the few genuinely good retail financial products.

Cryptocurrency: highly volatile, speculative, and unregulated. Bitcoin has produced extraordinary returns for early adopters — and devastating losses for buyers at peaks. No intrinsic value (unlike stocks, which represent business ownership). Treat as speculation, not investment. Position size: only money you can afford to lose entirely (1-5% of portfolio maximum for most people).

Commodities (gold, oil, agricultural): historically provide inflation hedging and crisis protection. Long-term returns: roughly matching inflation (0-2% real). Not wealth-building — wealth-preserving. Gold is insurance, not an investment.

Private equity / Angel investing: potentially high returns (20%+ IRR for top-quartile PE funds) but: illiquid (money locked 7-10 years), high minimums ($250K+), and the majority of startups fail. Accessible through some platforms (AngelList, Republic) at lower minimums. Only invest what you can afford to write off completely.

Collectibles (art, wine, watches, trading cards): Returns are real but: illiquid, storage/insurance costs, authentication risk, and markets are thin (finding a buyer at your price is not guaranteed). Rarely appropriate as a serious portfolio allocation. Buy because you enjoy them; any appreciation is a bonus.