Liquid Alternative Investments are a sign of a bubble in the bull market. They are becoming bigger and bigger everyday with more people investing in commodities rather than bonds, stocks or cash. More people are beginning to trust in the actual product instead of a bond or stock that can quickly vanish in thin air overnight.
The investment into liquids have more than doubles since 2008, they are very expensive especially to the average investor and the SEC views them as having heightened risk. All of these things put together show that they are extremely risky and may not perform better in the long run. Currently they are underperforming the market as we speak
Liquid alternative investments are not a sign of a bubble in a market where buying is the motivating force, They are in fact a product of changing financial needs where people need flexible financial solutions that invest in new or expanding sectors. These two factors make these products less reliant on traditional financial pit falls.
Liquid Alternative Investments have been around since 1940. Very simply put investors choose liquid alternative investments because they want more access to cash than regular hedge funds provide. That need by some investors is in no way a clear indication of a bubble in this bull market. Some investors are simply not comfortable without a certain level of access to their funds.