A summary of our alternatives outlook
- Historically, alternatives have been considered an optional or rounding allocation for portfolios, reserved for the most sophisticated and well-funded investors. However, the realities of today’s markets are making it increasingly difficult for investors to reach their investment goals – and as such, we believe alternatives need to be redefined to include newer assets and should be considered a more integral allocation in portfolios going forward.
- While we believe that established alternative asset types like hedge funds, private equity and venture capital will continue to offer attractive illiquidity premia, newer alternative options provide additional opportunities to access uncorrelated returns or total return potential. With the search for yield and lack of correlation intensifying, there is an urgent need within the industry to rethink alternatives in a way that both acknowledges established asset types, but more importantly, expands and redefines the asset class based on evolving and innovative options coming to market, such as newer exposures in private credit, digital assets and untapped sectors like lifestyle assets and innovation financing. We believe that the universe of “alternative” opportunities, and their accessibility, continues to grow rapidly.
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Tags: Digital Currency, Diversification, Hedge Fund Strategy