Podcast
Questions and Answers
What should retail investors consider when reallocating funds from public equities to alternative investments?
What should retail investors consider when reallocating funds from public equities to alternative investments?
- Reallocate funds from public equities to government bonds
- Reallocate funds from fixed income to private credit (correct)
- Reallocate funds from private real assets to public equities
- Reallocate funds from private equity to fixed income
What should advisors consider when reallocating into private markets?
What should advisors consider when reallocating into private markets?
- Their long-term equity-fixed income mix (correct)
- Their allocation to public equities
- Their short-term equity-fixed income mix
- Their allocation to government bonds
How can downturns in the market benefit private investors?
How can downturns in the market benefit private investors?
- By causing them to lose money
- By setting up the next three to five years of returns in private markets (correct)
- By causing them to increase their allocation to public equities
- By causing them to decrease their allocation to private markets
Who should take advantage of recent valuations to increase their allocation to alternatives?
Who should take advantage of recent valuations to increase their allocation to alternatives?
How can adding alternatives potentially increase returns?
How can adding alternatives potentially increase returns?
What is important to consider when considering alternatives?
What is important to consider when considering alternatives?
Who can be considered a good option for alternative investment opportunities?
Who can be considered a good option for alternative investment opportunities?
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Study Notes
- Retail investors interested in alternative investments should consider reallocating funds from public equities to private equity, from fixed income to private credit, and from a blend of equity and fixed income to private real assets.
- Advisors with cash should consider their long-term equity-fixed income mix when reallocating into private markets.
- Downturns like the current market situation can set up the next three to five years of returns in private markets.
- Private investors who are not yet allocated to alternatives or have a small allocation should take advantage of recent valuations to increase their allocations.
- A 60/40 mix may result in mid-single digit returns with high volatility, while adding alternatives can potentially increase returns by 5% with less volatility.
- Homework and due diligence are important when considering alternatives, and it is recommended to hire good professionals.
- Blue Owl is partnered with all the firms on the panel and can be considered a good option for alternative investment opportunities.
- Volatility and chaos create opportunities for investors.
- Good quality managers can add value to clients' portfolios.
- The panelists express gratitude for the opportunity to discuss alternative investments.
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