The study (to the left) indicates that in 2009, in the aftermath of the Great Recession, the typical individual investor had virtually no exposure to the so-called alternative investment asset classes. Whereas large institutions had approximately half of their portfolios allocated to "alternatives."
According to a recent survey 68% of advisors have increased their use of alternative investments since the financial crisis in 2008.* Whereas alternative investments were once an option for only institutions, endowments and high net worth individuals, alternatives have become more mainstream over the last few years. Yet, there remains widespread confusion amongst investors about what alternative investments really are.
In a survey conducted by Natixis it was revealed that 47% of investors acknowledged they were worried about losing money due to market volatility; yet, 40% were not interested in considering alternative investments, which potentially could diversify portfolio returns! Furthermore, 40% of the polled individuals had no idea what an alternative investment is!**
The generic term "alternative investments" is a catch-all phrase, and mean different things to different advisors and investors. The goal of this website is to demystify the world of alternative investments. Please click here to learn more.
Despite unique risks and considerations, alternative investments can be useful tools to improve the risk-return characteristics of an investment portfolio. Read More
There are several risks associated with alternative investments above and beyond the typical risks associated with traditional investments. Read More
Alternative Investments may not be suitable for all investors and involve special risks such as leveraging the investment, potential adverse market forces, regulatory changes and potentially illiquidity. The strategies employed in the management of alternative investments may accelerate the velocity of potential losses.
* Jefferson National Survey, Sept. 7, 2011 **Natxis Survey, May and June 2011 amongst investors with at least $200,000 in investible assets.