Advisors Plan to Boost Clients' Private Equity Holdings: Survey

News June 25, 2024 at 03:08 PM

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A magnifying glass on a a collection of charts with the term 'private equity' in it.

Advisors planning to boost clients' private markets holdings in the next 12 months are most likely to increase allocations to private equity, according to a new survey from alternative asset manager Blackstone.

Blackstone, which recently surveyed financial professionals globally participating in its programming, found that about 90% of advisors have allocated to private markets in client portfolios, and over 70% have allocated 5% or more to these alternatives.

Advisors approaching clients about investing in private markets overwhelmingly, at 71%, cite the benefits of portfolio diversification, the survey found.

"Investors are more focused on diversification in recent years due to shifts in the macroeconomic environment and positive correlation between stocks and bonds. For clients seeking portfolio diversification, private markets can serve as a core component of their investment strategy," the firm said.

Advisors in the survey cited private equity most frequently as the allocation they were most likely to increase over the next year, according to Blackstone.

"Around 90% of companies with annual revenues of $250 million or more are privately owned. Private equity offers a significant investable opportunity that has historically outperformed public markets by an average of 6% per year since 2007," the firm said.

Blackstone's investment offerings include private equity, real estate, credit and hedge fund products.

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