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Alternative Market Briefing

98% of responding wealth advisors to increase alternatives allocation in 2021

Thursday, February 04, 2021

Laxman Pai, Opalesque Asia:

98% of responding wealth advisors indicated they plan to increase or maintain client exposure to alternative investments in the coming year, said a new survey from PPB Capital Partners (PPB)

For those looking to add to their exposure, 85% indicated that they plan to increase their allocation between 5%-10% over the next 12-months. This is a big difference from 2017 when PPB's survey revealed that 7% of respondents planned to decrease their clients' alternatives allocations.

The survey results are based on the responses of 130 wealth advisors. Of those surveyed, 83% were RIAs or Bank Wealth Groups, 9% were Family Offices, and the remaining respondents were a combination of Institutions, Consultants, or High Net Worth Investors. About two-thirds of respondents manage over $1B in assets.

"These results are significant," said PPB's Founder and CEO Brendan Lake. "Almost 50% of wealth advisors said over half of their clients own alternative investments. For 24% of wealth advisors, the increased volatility seen in the markets during the COVID-19 pandemic has changed their view on the need for alternatives. But, implementing alternative investments can present operational challenges for wealth advisors and their clients."

The majority of wealth advisors said that they use alternative strategies for diversification, risk management, and/or to enhance returns. Only 36% said they use alternatives for income, and less than 15% said they use alte......................

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