Alternatives Symposium Summary

The Inside Network’s Alternatives Symposium welcomed financial advisers, asset consultants and family offices to collaborate and discuss the challenges faced in delivering CPI+plus returns over the next decade.

Investment decision makers face an uncertain period for portfolio construction after a prolonged era of productive years. The thirty-year tailwind of falling interest rates has dissipated, triggering a new paradigm which will challenge for the outlook for bond and equity markets. Many forecasters are predicting future returns from these traditional asset classes to be among the lowest in recent history.

In this unique environment, advisers and asset allocators are being encouraged to seek less conventional sources of returns and diversification to maximise the probability of delivering the heightened return expectations of clients.

Alternative assets have long been a core component of institutional portfolios, yet remain in their infancy within advised portfolios. Many of the issues driving the lack of adoption in private portfolios have dissipated with investors now able to access to a broader range of high quality strategies and seeing significant growth in the availability of liquid options.

With sub asset classes that span everything from real assets to private equity, venture capital and equity alternatives, the sector requires extensive knowledge and experience to navigate the unique opportunity set and due diligence requirements.

Despite this, the benefits are clear. Recent years have shown that the correlation and diversification benefits of alternative assets smooth returns during periods of volatility. As importantly, they can perform strongly when more mainstream asset classes struggle.