Which of the following is NOT considered an alternative investment?

Government bonds are classified as traditional investments rather than alternative investments. This distinction is made because government bonds are widely recognized, heavily regulated financial instruments that are used by both individual and institutional investors. They provide predictable income streams and are considered a safer and more stable form of investment compared to alternatives.

In contrast, private equity, real estate, and hedge funds fall under the category of alternative investments due to their unique characteristics and investment structures. Private equity involves investing in privately held companies, often requiring a longer investment horizon and a higher risk tolerance. Real estate encompasses investments in properties and land, which can yield both income and appreciation, but also comes with liquidity risks. Hedge funds employ a range of strategies, including short selling and leveraging, which often involve higher complexity and risk.

Understanding these differences is crucial for investors looking to diversify their portfolios and manage their risk effectively.