Financial Advisors Set to Boost Client Allocations to Alternative Assets in 2024
From the desk of Jim Eccleston at Eccleston Law
A recent independent survey conducted by CAIS and Mercer reveals that 62 percent of financial advisors currently allocate between 6 percent and 25 percent of clients' portfolios to alternative asset classes.
The survey, conducted at the second annual CAIS Alternative Investment Summit, which brought together independent advisors and alternative asset managers, indicates a significant trend toward increased allocations to alternative assets. Specifically, 85 percent of financial advisors anticipate boosting allocations to one or more alternative asset classes within the next year.
According to InvestmentNews, the survey underscores the recognition among financial advisors regarding the role of alternative investments. Notably, 78 percent of advisors acknowledge that incorporating alternative assets helps clients achieve their goals and objectives. Furthermore, 59 percent believe that access to alternative investment opportunities contributes to their success in attracting new clients.
Despite the increasing demand for alternative investments, the survey reveals that financial advisors encounter hurdles in their adoption. A significant 55 percent of respondents identify high levels of administration and paperwork as a significant barrier to investing in alternative strategies. Additionally, concerns about lack of liquidity (47 percent) and apprehensions related to due diligence and compliance (35 percent) are cited as additional challenges inhibiting entry into the alternative investment space.
Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, transition, regulatory, and disciplinary matters.
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