Aug 21 2015 | 4:43pm ET
Despite ongoing debates over performance and fees, institutional appetite for alternative assets shows no sign of slowing down, according to new data from Preqin.
Preqin latest Investor Outlook reveals that fully 79% of institutional managers have exposure to at least one alternative asset class. More than 50% had exposure to private equity and hedge funds, 43% to private debt and nearly two-thirds had real estate investments. Approximately 36% had infrastructure exposure.
Preqin noted that although benefits vary significantly between them, reasons often cited by investors for holding allocations to alternative assets include diversification, high returns, reliable income streams and inflation hedging characteristics.
Other key findings of the report:
“Institutional investors allocate to alternative assets to diversify their portfolios and to achieve a broad range of other objectives,” noted Preqin CEO Mark O’Hare. “The high absolute returns generated by private equity, hedge funds’ ability to reduce volatility, the reliable income generated by private debt and the inflation-hedging characteristics of real assets are just some of the attractions for sophisticated investors.
“There remains huge scope for the alternative assets industry to grow in future years, both as investors build up existing allocations, and as they also further diversify their portfolios to include a wider range of asset classes,” he continued.
Preqin surveyed 460 investors in alternative assets for the survey, 43% of which were in North America, 31% in Europe, 22% in Asia and 4% elsewhere. As for investor types, 16% were private sector pension funds, 13% public pension funds, 10% foundations, 10% endowment plans, 10% insurance companies, 9% asset managers, 8% family offices, 6% banks, and the remaining 18% fell into other institutional investor categories.
The full report is available here.
Jan 30 2018 | 9:49pm ET
As the U.S. shifts from monetary stimulus to fiscal stimulus, market pricing should...
May 24 2017 | 9:25pm ET
Starting in 2019, financial industry executives sitting for the coveted Chartered...
Feb 14 2018 | 9:57pm ET
Tasked with delivering returns on client capital, a common dilemma for many alternative...