Use of Alternative Investments on Rise, Jackson Survey Finds

Jackson found the reason for an increased use of alternative asset classes was consistent among advisers, with nearly two-thirds citing further diversification as the primary purpose. However, the company said the practical use of alternatives was not as clear among respondents. Understanding of alternative asset classes and clarity on how to use them within client portfolios topped the list of advisor concerns. The contrast between the demand for alternatives and advisor confidence in their proper utilization highlights a specific knowledge gap for product providers to consider.

The company also said that with alternative use on the rise, guided strategies may become an important part of bridging that knowledge gap for advisors. According to those surveyed, guided strategies from product providers will play a key role in their use of alternatives. More than 95% of respondents said that guided strategies would be very or somewhat important in their construction of client portfolios. Nearly four out of five advisors said they would be more likely to use alternatives if offered within a guided strategy.

“The needs of investors are changing in today’s marketplace,” Jack said. “Portfolio allocation strategies are evolving beyond the traditional 60/40 model. As financial advisors adapt to these new strategies and rely more on alternative asset classes, product providers must offer the tools and resources they need to meet these demands. The advisors who took part in this survey made it very clear that guided strategies could play an important role in that effort.”