Alternatives Remain In Growth Phase

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    Alternative investments remain squarely in the growth phase, with investors across the globe looking beyond absolute returns as they seek to incorporate liquidity needs, regulatory status, and transparency when weighing their alternatives allocation decisions, says a Deutsche Asset & Wealth Management survey. Meanwhile, ‘The Alternative Perspective – 2014 Global Survey of Investors in Alternatives’ shows the definition of what constitutes an alternative investment continues to vary by region and, to a greater extent, by organization type. These dynamics create opportunities and challenges for helping investors fully understand their potential alternatives contributions. The survey also found that while investors expect private equity primaries, single strategy hedge funds, private infrastructure, and private real estate to outperform, liquid alternatives, multi-strategy hedge funds, and private equity secondaries may command larger flows as investors increasingly focus on factors other than absolute returns. As well, liquidity needs vary by organization type and region. Going forward, investors with high liquidity needs will increasingly turn to the expanding universe of liquid alternatives, while those with low liquidity needs will seek to capitalize on that flexibility in the form of higher potential rewards or better fee terms.