Brookfield Oaktree Wealth Solutions | Our Latest Research Insights

Investors are Overwhelmingly Satisfied with Alts Performance, Ready to Expand Use
Advisors Have the Power to Accelerate Alts Usage, Investors Want Them to Lead
Advisors Consider Alternatives a Key Driver for Practice Growth, Say Commitment is Worth It

Investors are overwhelmingly satisfied with alternative investments

93% of alts users are satisfied with the performance of their alternative investments.

85% of alts users believe alternatives are essential to a successful portfolio strategy.

Advisors have the power to expand clients’ alternatives investing footprint

85% of alts users would invest more if their advisor recommended it.

70% of alts non-users would begin investing in alternatives if advised to.

Investors expect their advisor to stay ahead of the curve

Both alts users (90%) and non-users (67%) want their advisor to stay ahead of the curve when it comes to new investment opportunities in alts.

Advisors consider alternatives to be a practice differentiator

80% say alts expertise is a “must have.”

72% of advisors say alts expertise will be a meaningful driver in growing their book of business.

A commitment worth making

73% of advisors say client concerns about alternatives are easily allayed through education.

Majority of advisors also say it takes only a few days or less to get comfortable with a new product or asset class.

Understanding Today’s Alternative Investors

As alternatives become increasingly important to investors’ portfolios, understanding investors' distinct attitudes, beliefs, and motivations around alternative investments can help financial professionals and clients have more meaningful conversations. A segmentation analysis of the North America and Asia high-net-worth investor surveys revealed three archetypes.

Alts Champions

Emerging Adopters

Traditionalists

Alts Champions

Ready and Eager to Expand Alternatives Footprint

Key Characteristics

Focus more on upside potential than downside risk
Believe alternatives are essential to a successful portfolio strategy
Want greater variety beyond their current portfolio holdings

Working with Alts Champions

Provide knowledge and guidance on new alternative investing opportunities
Explain products or strategies in depth, with a focus on the benefits of alternatives to their portfolio
Stay “ahead of the curve” on alternatives

Emerging Adopters

Open to Increasing Alts Allocation, Seeking Deeper Insight

Key Characteristics

Focused on the long term and have a favorable view of alternatives generally
Comfortable with illiquid investments as long as they can redeem within a reasonable timeframe
Interested in investing in alts or putting more money into alts and many are willing to allocate as much as 20% to the asset class

Working with Emerging Adopters

Offer more in-depth knowledge about alternatives and address common misconceptions (e.g., long timeframes and illiquidity)
Talk about different alts vehicles across public and private markets that align with their risk tolerance and can mitigate liquidity concerns
Bring alternative investing opportunities that align with their interests

Traditionalists

Willing to Invest in Alternatives, Want Advisor to Make a Strong Case

Key Characteristics

Focused on the long term and growing their portfolio while keeping an eye on income and capital preservation
View alternatives more as a diversification tool than a core portfolio holding
Less knowledgeable about alternatives but willing to invest if their advisor makes a good case for using alternatives in their portfolio

Working with Traditionalists

Provide education about the benefits of alts and the growing universe of alternatives, including opportunities without long lockups
Show how alternatives fit with personal goals and interests
Start with small initial investments and increase exposure after demonstrated success

Incorporating Alts Into Your Practice:
Assess Your Approach.

As alternatives increasingly become an essential part of high-net-worth investors’ portfolio strategy, advisors have a critical role to play in helping their clients maximize the opportunities ahead. Our new research shows that alternatives expertise can serve as a practice differentiator and help improve client outcomes.

Thinking about your own experience engaging investors around alternatives, take this quiz and see how your responses stack up to the results of our recent survey of advisors and investors.

QUESTION ONE

How would you describe your knowledge of alternative investments?

Education is key to showing value to investors

90% of alts users say they want their advisor to “stay ahead of the curve” when it comes to new investment opportunities.

Continuing to build your alts expertise is important because our research tells us that the most knowledgeable advisors in alts cite the broadest range of practice benefits rooted in their implementation of alternatives.

“[Strengthening my alternatives expertise]
is an ongoing learning process. It keeps us
fresh. We should be
continuing to assess
the marketplace for
anything that could
benefit the client.”

— U.S. WIREHOUSE-AFFILIATED ADVISOR
WITH $1 BILLION PLUS TEAM AUM

Education is key to showing value to investors

Enhancing your alts expertise is important because as advisors build their alts knowledge, investors become more open to investing in alternatives.

Investors tell us that they’d like advisors to share education on asset classes and investment opportunities that closely align with their interests, and they appreciate it when advisors provide information at the right level of detail.

80%

of advisors say
alts expertise
is a "must have."

Education is key to showing value to investors

As the universe of alternative investment vehicles expands, it’s important to consider that alternatives will be a fit for a broader cohort of investors.

In fact, our research shows that most investors—both current alts users and non-users—want their advisor to talk to them more about alternatives. It’s a step worth taking as building a strong working knowledge of alternatives leads to greater client openness to alts and a smoother path to adoption.

74%

of investors want to learn more about alternatives.

QUESTION TWO

What would you say to a fellow advisor looking to better understand how implementing alternatives might impact their practice?

Select your responses from the below:

A commitment
worth making

As you’ve shared, alternatives can be a strong practice differentiator and this sentiment echoes what we heard from our advisor survey as respondents noted that improved absolute returns, increased client satisfaction and differentiation from competitors are the top benefits of alts implementation.

“We’ve received referrals from clients because they’re talking to their friends about the returns that they got or how the use of alts defended their portfolio.”

— U.S. RIA, ALTS POWER USER,
$750 MILLION-PLUS TEAM AUM

Advisors consider alternatives to be a practice differentiator

While you may have some reservations about the benefits of alts usage, more than 9 in 10 advisors tell us that building a strong working knowledge of alternatives is a commitment worth making.

Advisors also tell us that having alts expertise will be a meaningful driver in growing their business.

“We’ve received referrals from clients because they’re talking to their friends about the returns that they got or how the use of alts defended their portfolio.”

— U.S. RIA, ALTS POWER USER,
$750 MILLION-PLUS TEAM AUM

Advisors consider alternatives to be a practice differentiator

While you may not have seen the benefits of alts implementation yet, advisors tell us that building a strong working knowledge of alternatives is a commitment worth making and that alts expertise will be a meaningful driver in growing their business.

“We’ve received referrals from clients because they’re talking to their friends about the returns that they got or how the use of alts defended their portfolio.”

— U.S. RIA, ALTS POWER USER,
$750 MILLION-PLUS TEAM AUM

QUESTION THREE

Why do you think some clients are less open to investing in alternatives?

Select the top reason from the below:

Advisors have the power to expand clients’ alternative investing footprint

Our research tells us that most high-net-worth investors, including those not using alternatives, are well positioned for alts even if they don’t fully realize it. Investors’ core beliefs and values as evidenced by our survey―a long-term focus, a willingness to ride out volatility and few immediate liquidity needs―point to an ongoing opportunity to broaden the investor base for alts usage.

Encouragingly, 91% of non-users believe diversification is critical to managing risk. The good news is that education goes a long way in addressing any investor concerns and perceived challenges about alternatives and there are many resources available to advisors looking to help their clients better understand the benefits and features of alternatives.

91%

of investors are
willing to ride out an
investment's volatility
in order to achieve
their investment goals
over the long term.

Advisors have the power to expand clients’ alternative investing footprint

While concerns around liquidity do come up, about half of alts users and non-users say they are comfortable sacrificing liquidity for growth. 82% of non-users say that they are comfortable with investments that limit their ability to redeem in order to protect outcomes.

The good news is that education goes a long way in addressing any investor concerns and perceived challenges about alternatives and there are many resources available to advisors looking to help their clients better understand the benefits and features of alternatives.

81%

of HNWI say they're
unlikely to have
short-term cash needs.

Advisors have the power to expand clients’ alternative investing footprint

While many investors may perceive alternatives as expensive, an overwhelming majority of investors using alts tell us that the outcomes alternative investments generate are worth the fees.

79%

of alts users agree
the outcomes are
worth the fees.

Advisors have the power to expand clients’ alternative investing footprint

As investors move beyond the traditional 60/40 portfolio, most HNW investors believe that having an alternatives allocation will drive stronger long-term outcomes than a traditional portfolio.

93%

of alts users are
satisfied with the
performance of
their alternative investments.

QUESTION FOUR

How do you grade yourself on each of the following when it comes to engaging your clients around alternatives?

Please assign a grade A, B, C, D or F.

Alternatives Report Card

Explaining alternatives asset classes

Providing information in the level of detail that clients are looking for

Supplying data and evidence to support the case for the asset class or investment opportunity

Sharing education on assets classes or investment opportunities that closely align with a client’s interests

Staying ahead of the curve when it comes to educating clients about alternative asset classes and investment opportunities

Advisor expertise facilitates investor adoption

You’re doing a great job engaging with clients around alternatives and this is critical because both alts users and non-users say that they want their advisors to talk to them more about alts.

Investors also shared that the top two areas of improvement for advisors regarding alternatives include supplying data to support the case for alternatives and staying ahead of the curve regarding alts opportunities.

“Sharing the numbers
and insights helps me a
lot. Seeing what the (GP
is) thinking, what
they’re up to and what
they’re doing helps
alleviate the unknown.”

— U.S. INVESTOR WITH
$6M INVESTMENT PORTFOLIO

Advisor expertise facilitates investor adoption

It can be challenging to stay ahead of the curve when it comes to alternative investment expertise, but there are plenty of comprehensive resources to help advisors engage with their clients around alternatives.

It’s an effort worth making as investors are really looking to their advisor to guide them through their alts journey. We are committed to serving as a trusted partner to advisors and our new Alts Institute has comprehensive resources to enhance your alts knowledge and expertise.

“The more I learn, the
more I know what I
don’t know, so I do rely
heavily on my planner.”

— U.S. INVESTOR WITH $30 MILLION
INVESTMENT PORTFOLIO

QUESTION FIVE

Using the scale, tell us what percentage of clients you think have either switched or would consider switching advisors in order to access better quality alternatives?

Investors want advisors’ guidance

Many investors say access to new alts opportunities is a priority, signaling that the strength of your alternatives offer is a cornerstone of the advisor-investor relationship.

With such a high bar for investor expectations, we have developed a library of “Essentials” content about different categories of alternatives to help advisors stay informed about the evolving alts marketplace.

41%

of investors said they
have moved or would
consider moving
advisors to access
better alts
opportunities.

Investors want advisors’ guidance

Your instincts are correct. Most advisors say that those without a strong alternatives offering will be left behind so it’s clear that advisors understand how important alts expertise and knowledge is to their clients and to their practice.

41%

of investors said they
have moved or would
consider moving
advisors to access
better alts
opportunities.

Investors want advisors’ guidance

As the universe of alternative investing continues to grow and investors gain access to a wider range of alts investment products, as you have noted, the advisor-client relationship becomes even more critical.

Many investors say access to new alts opportunities is a priority, signaling that the strength of your alternatives offer is a cornerstone of the advisor-investor relationship. With such a high bar for investor expectations, we have developed a library of “Essentials” content about different categories of alternatives to help advisors stay informed about the evolving alts marketplace that can be found on brookfieldoaktree.com.

41%

of investors said they
have moved or would
consider moving
advisors to access
better alts
opportunities.

Keep taking the right
steps to stay ahead
of the curve

Based on your responses, it's clear that you have a solid understanding of using alternatives with your clients. As the alts landscape continues to expand, taking a deep dive into investor insights will help enrich your client conversations and position you as a forward-thinking advisor.

Here are some quick and easy opportunities to expand your expertise:

This investor segmentation revealed distinct investor attitudes and behaviors. Understanding these can help you have even deeper conversations about how alternatives can address their specific concerns, goals, and portfolio strategy.

Explore now

For a more in-depth look into the overall research findings, download “The Power of Alternative Investments: Building Better Portfolios and Stronger Client Relationships.”

Explore now

Reach out to the Brookfield Oaktree Wealth Solutions client team to learn how we can be your partner in growing your alternatives expertise and practice.

Contact the team

Dive deeper into
the benefits of
alternatives

By taking this quiz, you’ve taken steps to learn more about engaging your clients around alternatives. As investor interest in alternatives continues to grow, deepening your alts knowledge with specialized, action-oriented and research-informed resources can help more meaningfully engage clients as you guide them through building a successful portfolio strategy.

Here are some quick and easy opportunities to grow your alts knowledge:

Download “The Power of Alternative Investments: Building Better Portfolios and Stronger Client Relationships” to explore more in-depth high-net-worth investor and advisor perspectives on alternative investing and what it means for engaging with clients.

Explore now

Check out our Demystifying Alternative investments presentation and the accompanying white paper for a deeper dive into the case for using alts and four specific alternatives asset classes.

Explore now

Reach out to the Brookfield Oaktree Wealth Solutions client team to learn how we can be your partner in growing your alternatives expertise and practice.

Contact the team

Survey Methodology
Brookfield Oaktree Wealth Solutions commissioned CoreData Research to conduct separate online surveys of 300 financial professionals with an average practice AUM of US $633 million in the US and Canada and 625 high-net-worth investors at least US $2.5 million in household investable assets in the US, Canada, Hong Kong, Singapore, and Taiwan between April and June 2024.

Alt Investing Survey: Asia Pacific Edition

What's on the Mind of Investors in Asia Pacific

Explore key findings compared to North American investors.

Introducing The Alts Institute Alternative Investing Survey

Investors are overwhelmingly satisfied with alternative investments

Advisors have the power to expand clients’ alternatives investing footprint

Investors expect their advisor to stay ahead of the curve

Advisors consider alternatives to be a practice differentiator

A commitment worth making

Alternative Investing Survey Insights

Understanding Today’s Alternative Investors

Alts Champions

Ready and Eager to Expand Alternatives Footprint

Key Characteristics

Working with Alts Champions

Emerging Adopters

Open to Increasing Alts Allocation, Seeking Deeper Insight

Key Characteristics

Working with Emerging Adopters

Traditionalists

Willing to Invest in Alternatives, Want Advisor to Make a Strong Case

Key Characteristics

Working with Traditionalists

Incorporating Alts Into Your Practice: Assess Your Approach.

The Alts Conversation: Are you Prepared?

What's on the Mind of Investors in Asia Pacific

The Alts Institute Resources

Alternative Investing Survey Key Findings and Profiles: North America Investors

Alternative Investing Survey Key Findings: North America Advisors

Alternative Investing Survey Key Findings and Profiles: Asia Pacific Investors

Diversifying with Private Markets Seminar

Alternative Investing Survey Key Findings and Profiles: North America Investors

Alternative Investing Survey Key Findings: North America Advisors

Alternative Investing Survey Key Findings and Profiles: Asia Pacific Investors

Diversifying with Private Markets Seminar

Incorporating Alts Into Your Practice:
Assess Your Approach.