• High-risk investing is not for everyone, but it can be rewarding.3D dollar sign with multiple smaller dollar signs. image by Steve Johnson from Fotolia.com
  
  High-risk investing is not a strategy for those about to retire, for those funding a child's education, or for those badly in need of money. Ideally this segment of your portfolio should be no more than 20 percent of your total investment package. High-risk investing can be immensely rewarding if you properly mitigate risk with investments in low-risk products. The first thing a high-risk investor should do is to inventory his investments.
  
  

Real Estate

• house blueprint and house model studio isolated image by dinostock from Fotolia.com
  
  Historically, real estate has not been considered high risk, but the post housing bust economy offers many high-risk options. One of the best options is to "flip" a house. In this strategy, a buyer purchases a distraught property, puts the minimum amount of money possible into upgrades and improvements, and then attempts to sell the property at a profit. The investment cost is a minimal down payment and the cost of the improvements. The investor needs to be handy. Any money paid to contractors comes right out of the profits. He also needs to have time. The monthly mortgage payment will also eat into profits.
  
  A second type of investment is commercial real estate. Commercial real estate is risky because you are likely to lose tenants as the economy worsens. Commercial real estate investors tend to make enormous amounts of money when the economy is good, and also to lose large sums during recessions.
  
  

Hedge Funds

• Hedge funds can be likened to unregulated mutual funds. Due to their unregulated nature, managers have more flexibility to react to the market. This could include taking short positions or moving assets around quickly to take advantage of market forces. The down side is these strategies also mean you can lose money almost immediately. Hedge funds generally invest in a wide variety of financial instruments. A typical mix would include stocks, commodities and debt.
  
  

Foreign Exchange

• Foreign Exchange (Forex) trading is when a buyer purchases one currency, paying for it in another currency. An example would be buying Euros with U.S. Dollars. Forex investments are mostly made by large financial institutions. There is also a substantial futures market trading Forex contracts. Forex can be risky because you are essentially buying into a nations financial health-- and political changes can quickly devalue a foreign currency.