Advisers are planning to increase allocations to alternative investments as they seek to diversify client portfolios and achieve specific objectives such as volatility mitigation and greater income potential, according to Cerulli Associates in partnership with the Investments & Wealth Institute (IWI) in a recent report.
Allocating to alternative investments including private markets has never been more important as market conditions coalesce to make diversification, enhanced return potential, volatility mitigation and income potential more important to clients. However, there are the educational challenges. In addition to understanding the products for their own sake, advisers also must be ready to explain the products to their clients.
In the second quarter 2023, Cerulli Associates, in partnership with the IWI, conducted a comprehensive survey of more than 200 advisers on their use of alternative investments, with a focus on the implementation of the products into