A new study by suggests that ultra high net worth U.S. investors continue to show strong interest in various alternative investment products.

The report by Chicago-based consulting firm Spectrem Group profiles the demographics, attitudes and behaviors of “alternative investors”, who represent 21% of investors with greater than $5 million net worth, and contrasts them with “traditional investors”. (All amounts in U.S. dollars.)

Alternative investors tend to be younger as a group, with twice as large a net worth and investable assets as traditional investors and three times the income. Penetration as well as the level of investment is far greater at upper levels of wealth, with 62% of households with greater than $25 million investing in alternative investments, compared to only 19% of those with between $5-$10 million net worth.

It also found that alternative investors are highly involved investors, entrepreneurial and willing to employ prudent risks to achieve their investment objectives. Over half (55%) own or share ownership in a private business, compared with 36% of traditional investors. Venture capital and private equity are the preferred investments, with 14% of all ultra high net worth households holding these investments.

Private equity as well as owning a closely held business remain the preferred investment. Hedge funds are not as well understood by most investors and currently continue to be utilized most heavily by households in the upper tiers of wealth. One fifth of investors with greater than $25 million net worth own hedge funds, with an average balance of $2.7 million; only 3% of investors with between $5-$10 million own these products today.

Alternative investors make heavy use of financial advisors. However, they expect a more collaborative working relationship with their advisors and make use of technical investment specialists who can guide them with a private equity or venture capital investment.