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A historic shift in defined contribution plans and retail asset allocation is accelerating.
Retail investors and defined contribution (DC) plans face a dilemma. Macroeconomic shocks, market volatility and rising interest rates have delivered historically low annual returns for public market equities and bonds. As a result, concerns are growing that traditional 60/40 portfolios can no longer deliver the diversification that investors require. One potential remedy lies in alternative market assets such as private equity, debt and real estate.
Ultra-high-net-worth individuals, institutional investors and defined benefit pension plans have consistently hiked their exposure to private markets as evidence of their outperformance has grown. Yet this fast-growing asset class has remained largely off limits to retail investors. Seemingly, regulators are focused on retail access with concerns about alternative assets’ complexity and potential risks. Certainly, alternative assets can be more complicated than traditional portfolios. But industry collaboration could overcome these challenges, unlocking retail access to private markets that could help future retirees better fund their retirement.
Our new whitepaper discusses the drivers of the democratization of alternatives and how the industry is responding.
FULL REPORT
Learn more about the retailization of alternatives in major markets and possible solutions to help bring the benefits of alternative investments to retail investors and DC plans.
The report’s findings include:
TRENDING