The market has been remarkably resilient recently to the global challenges facing the world, but even the most optimistic investors are preparing for the fact that a bear market is already increasingly likely. Under these circumstances, adding passive-income investments to a portfolio can ensure that profits will continue if stock prices fall, Yahoo writes.

1. REAL ESTATE.

Any alternative investment would be incomplete without real estate, and it’s no secret that the passive income this asset class offers can help protect overall returns in a falling market. And one of the most popular strategies for generating that passive income is REITs (real estate collective investment trusts) with high dividends. When considering REITs that can withstand a potential economic downturn, it’s important to choose companies with healthy balance sheets, reasonable payout ratios and real estate portfolios with a positive outlook. Among publicly traded REITs, there are 2 REITs that currently meet these criteria: VICI Properties Inc (NYSE:VICI) and Community Health Systems Inc (NYSE:CYH) Inc. Both companies have good debt-to-EBITDA ratios and good dividends. The downside of publicly traded REITs is that the stock price is vulnerable to general market volatility. Private REITs: their shares are not traded on a stock exchange, so investors’ capital tends to be better protected from a downturn in the stock market. One might mention CrowdStreet Private Equity REIT I (C-REIT), which offers the rare opportunity to invest in a private REIT with a minimum investment of $25k, compared to the six-figure minimum investment required for most real estate private equity funds.

2. REAL ESTATE CROWDFUNDING

This option is now becoming a mainstream option for real estate investment companies and developers to fund deals. Through their platforms, these companies can now offer opportunities to raise capital not only through private equity firms but also from individuals. Investors can browse through real estate offerings and select deals that match their investment goals. There are even budget options available for real estate investing for as little as $100.

3. FINE ART

The fine art market has been getting more attention lately, with contemporary art outperforming the S&P 500 Index over the past 25 years with an average annualized return of 14.1%. Most notable, however, is its performance in years of high inflation and market declines. High-end art prices rise an average of 23.2% when inflation is at least 3%, and they have outperformed even the 10 major asset classes in 2020. However, prices for some of the most significant pieces are over $1 million, making it difficult for the average investor to access this market. Not all works of art are so unique, however. Some investors have made impressive profits on paintings bought in the $5k to $10k range, including Leonardo da Vinci’s “Savior of the World,” bought for $10k and sold for over $450 million 12 years later.

The problem is that investing in art is highly speculative and more often results in losses than gains. The best option for most retail investors is to buy shares in works that are traded at the higher end of the market, where more stable returns can be realized.