Advisors Are Increasingly Turning to Alternatives

According to a recent survey by Broadridge Financial Solutions, 67% of financial advisers are using alternative investments such as real estate investment trusts and private funds, compared to 59% in a previous survey taken earlier in the year. Of the 400 advisors surveyed by Broadridge, more than half said they plan to increase the use of alternatives over the next two years over traditional assets such as stocks and bonds. However, the advisers also noted their disappointment in the available offerings, with just 27% saying they are very satisfied with the options available from asset managers. Among the issues leading to this disappointment are too few choices, too much paperwork, and compliance and regulatory concerns. As per the reason for the increased interest in alternatives, advisers cited diversification, followed by non-correlation with equities. According to the survey, the alternatives that advisors were most interested in were REITs, commodities, private equity, hedge funds, and private debt.

Finsum: With investors concerned over steep portfolio losses, advisors are showing an increased interest in alternatives such as REITs, commodities, private equity, hedge funds, and private debt.

  • alternatives
  • advisors
  • private equity
  • bear market

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