Institutional investors are putting more capital into
alternative strategies, not with the expected goal of diversifying
their portfolios or reducing risk, but with the goal of strong
returns amid the current low interest rate environment, according
to a BNY Mellon and FT Remark
survey of 400 senior executives at institutional investment
firms and 50 hedge fund executives. Almost two-thirds of those
surveyed received returns of 12% or higher from their alternative
allocations in 2015 and more than 25% had returns of at least 15%.
The strong returns are driving investors towards increased
allocations, with 29% planning to increase their alternative
holdings this year, demonstrating an increased appetite for
alternative elements in institutional investors'
portfolios.
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