WHY ALTERNATIVE INVESTMENTS?
More and more investors are looking at ways to diversify their assets. Interest in alternative investments is growing because alternative assets can be less correlated with traditional assets, meaning they can perform a role in portfolio diversification.
Over the last 30 years, allocation to alternative assets by institutions has grown from 5% to 25% on average, with some large institutions having very large exposures. Pension funds and endowments often cite the return potential and diversifying power of non-traditional asset classes as reasons for significantly higher expected returns.
Access to alternatives has not traditionally been easy, however, due to often complex structures, high minimum investment thresholds, high fees, minimal liquidity and long duration.