The majority (91%) of advised clients have increased their allocation to alternative assets over the past 12 months.
Research from Ortec Finance found that the main reasons behind this move were strong performance (71%) and the availability of more funds (53%).
Additionally, 50% point to the attractive returns and low correlation to equities as motivating factors.
Ortec Finance also found that over four fifths (81%) of financial advisers and wealth managers’ clients have been widening their investment scope.
The vast majority (97%) of advisers’ clients are building more international and diversified portfolios, with 87% expecting this trend to continue over the next three years.
Private equity is the most popular alternative asset class among clients, with 78% increasing their allocation during the past 12 months.
This is followed by private debt (76%), infrastructure (73%), venture capital (73%), hedge funds (50%) and real estate (35%).
Ortec Finance managing director global wealth solutions Tessa Kuijl said: “Wealth managers and financial advisers are adapting to a much wider range of investments as clients’ investment opportunities broaden.
“The shift to more diversified portfolios, including more alternatives and international portfolios, demand expanded expertise from wealth managers and advisers.
“We deem this a positive trend because it enables clients to benefit from a better risk-return equation to increase the probability of reaching their goals.”
Ortec Finance provides wealth managers and financial advisers with “scalable solutions that enable them to manage clients more efficiently and deliver more value to those clients”.
Ortec Finance commissioned PureProfile to interview 100 wealth managers and financial advisers located in the UK, Canada, Italy, the Netherlands, Germany and Switzerland whose organisations collectively manage around £1.207trn worth of assets for clients during April 2024.
