The investment world is wide and diverse, offering an extensive range of choices. Investments other than traditional ones such as stocks, bonds and cash are referred to as alternative investments.

Alternative investments include a wide variety of assets, ranging from popular investments like real estate and gold to less popular ones like artworks, antiques, premium wines, innovative health care products, and all sorts of collectables.

Although there are numerous possibilities, it is important to consider whether an investment is worthwhile. We should consider the risk-return profile, regulation, and investor protection of an investment before making an investment decision. However, many alternative investments are not regulated by any financial regulators in Hong Kong, and they may carry higher investment risks and involve certain investment scams. In fact, there have been cases of alternative investment scams involving premium wine, overseas properties, gold, and virtual assets.

To make alternative investments, you may purchase the assets directly or participate in the investment schemes. In recent years, there have been alternative investment schemes for overseas farms and land parcels. It is important to note that these schemes may constitute a collective investment scheme (CIS) under the Securities and Futures Ordinance. Under current regulations, unless exempted, all CISs must be authorised by the SFC before they can be offered to the Hong Kong public.

However, many alternative investment schemes suspected of being CISs are usually not authorised by the SFC. They may involve overseas farms and land parcels, hotels, shopping malls, or student dormitory. Moreover, it is difficult to verify whether these schemes are regulated by overseas regulators.

I have always said that we should not engage in investments that we are unfamiliar with, particularly alternative investment schemes come across online. Unauthorised investment arrangements involve higher risks and may not be suitable for the Hong Kong public. Furthermore, the product disclosure may not be clear and complete.