Advisors, Brokers Plan To Maintain Allocations To Alternatives

New York (HedgeCo.Net)The alternative investment industry seems to be in good standing with broker-dealer representatives and registered investment advisors, at least based on a recent survey from Pershing and Beacon Strategies, LLC. The survey polled 1,200 advisors about alternative investments and their use of them in client portfolios. From the perspective of the alternative investment industry, the findings have to be encouraging.

According to the survey, almost 75% of advisors surveyed use some form of alternative investments in client portfolios and 70% intend to maintain their current weightings for alternatives in 2015. On top of that, for the advisors using alternatives, 73% of their clients have at least one alternative investment vehicle in their portfolio.

Looking at the current weightings, 55% of advisors think having 6-15% of the portfolio in alternatives is optimal, 27% think the allocation should be 1-5% while 18% think a 16-25% weighting is appropriate.

True to the concept of what a hedge fund is designed to do, the majority of the advisors surveyed stated that the main reason for investing in alternatives is to reduce volatility and diversify client portfolios. When it comes to selecting an alternative product, the most important items appear to be manager experience and the diversification potential.
For those advisors that don’t use alternative investments at this time, the most common reasons cited included product expense and the viability and basic premise of alternative investments.

While HedgeCoVest may not be able to overcome the viability and basic premise issue, we can certainly help advisors overcome the product expense issue. With the low flat-rate fee of 2.5%, we can offer solutions to advisors and investors alike.

Rick Pendergraft
Research Analyst
HedgeCoVest

This entry was posted in HedgeCo Networks Press Releases, HedgeCo News, HedgeCoVest News. Bookmark the permalink.

Leave a Reply