Where Alts Sponsors Playing in the Retail Space Can Step Up Their Game
January 21, 2020 | Mike Huisman | The DI Wire
The opportunity for alternative investment sponsors couldn’t be clearer. With most institutions (and many high-net-worth individuals) having long ago followed “the Yale model” and allocated a portion of their investments to alternatives, the mass affluent arguably represent the key growth segment for alts sponsors.
According to a recent RIA Intel article that cited data from Cerulli Associates, retail investors today account for half of the addressable market for alternative investments. The same report indicated that fewer than half of advisors currently allocate client money to alternatives and, among those who do, the average allocation is less than 5 percent (versus 40 percent for high net worth investors).
Plenty of room to grow.
Sponsors get it and, in most areas of their business, are aggressively adjusting to this increasingly important constituency. They’re creating products that are simpler and often more liquid than their institutionally geared precursors…
