From its modest beginning as an acquisition strategy largely known as 'bootstrapping', the Alternatives industry is now expected to grow to more than $24 trillion by 2025. This surge in popularity can be attributed to the diversification benefits it offers to investors seeking non-traditional avenues for returns on their capital.
Through August, financial advisors had sold $76.6 billion of illiquid alternative investments, according to Robert A. Stanger & Co. Inc. This highlights the increasing interest in alternative assets such as private equity, hedge funds, real estate, and commodities among retail and institutional investors alike.
There's no slowdown in hiring at the end of September as investors, including AIMCo and insurer Northwestern Mutual, look to welcome new talent into the alternative investment space. This influx of new professionals underscores the growing demand for expertise in managing and allocating alternative assets effectively.
When NFL owners voted in August to begin letting certain private equity firms buy stakes in teams, the move signaled big cash infusions for sports franchises. This trend of alternative investments entering the sports industry showcases the diverse opportunities available in this evolving market.
Traditionally, foreign institutions used to account for a large share of alternative investment funds — a situation that is gradually shifting. Domestic investors are increasingly recognizing the benefits of diversifying their portfolios with alternative assets, leading to a more balanced distribution of capital within the industry.
Ramit Sethi, an incredibly successful multimillionaire and author of the personal finance bestseller “I Will Teach You to Be Rich,” has been a vocal advocate for alternative investments. His endorsement of these non-traditional assets has helped raise awareness about their potential benefits among a broader audience of investors.
Alternative investment platform CAIS has extended its offerings to include a slew of private debt funds for its independent financial advisors. This expansion of product offerings reflects the growing demand for alternative fixed-income options in a low-yield environment.
Mayer Brown advised Apollo Global Management Inc., a leading provider of alternative asset management and retirement solutions, on a recent transaction. This collaboration highlights the strategic partnerships that are crucial for the continued growth and success of alternative investment firms.
What's the outlook for alternative investments? Private equity funds with an older vintage — the year in which they first drew down capital — are expected to outperform newer funds in the current market environment. This trend underscores the importance of understanding the historical performance and track record of alternative assets when making investment decisions.
