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Laxman Pai, Opalesque Asia: Financial advisers are increasingly drawn to alternative investment strategies as a means of navigating an economic environment that appears fraught with potential pitfalls, said a study.
The findings from the new study by CAIS and Mercer show that nearly nine in 10 financial advisors surveyed plan to increase allocations to alternatives over the next two years.
The study also found that 89% of alternative asset managers and other financial professionals have identified the private wealth channel as a greater priority for their firm compared to two years ago.
According to the study, investors are increasingly turning to alternative investments to seek diversification, capital preservation, and/or uncorrelated returns.
More than half of the 97 financial advisors surveyed (53%) are considering raising their alternative asset allocations to more than 15% over the next two years, while more than one-fifth (21%) estimate their alternative asset allocations will exceed 25%. Only 8% of respondents do not plan to increase their alternative asset allocations within the same timeframe.
"We are increasingly seeing advisors target a three-dimensional portfolio that more closely resembles a 50/30/20 model across stocks, bonds, and alts," said Matt Brown, Founder, and CEO of CAIS. "These findings would seem to confirm that 'The Great Reallocation' of capital into alternative strategies is well underway within the private...................... To view our full article Click here
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