Archive for: Market Updates

Private alternatives have been a key part of Homrich Berg’s investment philosophy for over 25 years, and we believe they are as relevant today as they have ever been. 

With the potential for heightened public market volatility in both stocks and bonds, we believe this is an excellent time for investors who can be illiquid with a portion of their assets to consider private alternatives as a potential source of yield, diversification, or capital appreciation—or a combination of all three. 

The range of opportunities in this asset class is vast—and continues to expand. In fact, more than $23 trillion is expected to be invested in private alts by 2026, up from $13 trillion today. 

This magnitude of rising allocations toward alternatives supports our desire at Homrich Berg to educate investors about this asset class and continue to expand our clients’ access to private market opportunities.

As a leader in this space among independent fiduciary RIAs, our firm has been investing in private alts since the early 1990s. Since then, we’ve grown to be one of the leading independent RIA firms focused on these investments. The amount of client assets under management that are invested in private alternatives is nearly $1.5 billion (as of 3/31/2022), and we have a dedicated team of analysts who source, evaluate and monitor private investments. This includes CFA charterholder Dan Ziznewski, who oversees Homrich Berg’s sourcing, due diligence, and manager selection for private alternative asset classes and is a frequent commentator on the topic. 

Homrich Berg has access to a wide range of institutional brand-name firms as well as smaller niche players, including funds on the platforms of other wealth managers. Because we are a fiduciary independent firm, we are not driven by a motivation to “sell” a specific investment based on financial incentives. Rather, our sole focus is to invest with the managers we believe have the greatest potential to generate the best risk-adjusted returns for our clients. 

For those who might not meet the minimums of some private funds, we assemble internal funds of funds (with no extra management fee or incentive fee of any kind), which are diversified portfolios of alternative strategies. We’ve created nine such investment vehicles since 2000 with 100+ manager relationships inside those funds.

We work with each client to understand how best to implement alternatives into the overall financial plan. Depending on the client situation, investment options may differ. This includes understanding whether the client is an Accredited Investor, a Qualified Client, or a Qualified Purchaser, as defined by U.S. securities laws.

Learn more about the opportunities in this asset class and how our firm helps clients navigate this complex category. 

Contact us to learn more about how Homrich Berg can help you find the potential fits for your portfolio. 

 

 

KEY DISCLOSURES:  Above is a general discussion from Homrich Berg of current investment themes, asset classes, and specific investment segments. The discussion includes our opinions and forward looking thoughts and analysis as of 08/15/2022 and is not a guarantee of future investment results.

Actual client portfolios are often customized and do not necessarily represent an exact replication of, if any, allocation discussed. This presentation focuses on a wide range of economics and finance issues in order to educate you on the linkages between these topics and their impact on the overall economy and investment markets. The content of this presentation represents the opinions of Homrich Berg regarding these educational topics and should not be interpreted as direct investment advice or marketing of HB services. This presentation includes third party sources which we believe are reliable but have not been independently verified. Investing involves risks including loss of principal. This document does not constitute legal, tax accounting or investment advice.

Private alternative investments are not for every client. You must be qualified to invest in a private investment based on your net worth and/or other criteria, and you may qualify to invest in some alternative investments while not be allowed to invest in other alternative investments. Alternative investments are typically illiquid and are not risk-free, and there is no guarantee of achieving superior performance compared to similar liquid investments. Past performance is not a guarantee of future results for any investment. Please consult your Homrich Berg client service team to determine if private investments are suitable for your overall investment portfolio and to determine the appropriate allocation to private alternative investments if used in the portfolio.

CIO Stephanie Lang says markets may be bracing for Fed policy changes, which is why we’ve seen a slight flattening of the yield curve. Read the full piece by Jacob Sonenshine via Barron’s here.

“If you look at what drove the market in 2021, a lot of that will still be there next year, but it’s going to be somewhat moderated,” explains Homrich Berg CIO Stephanie Lang, CFA on Yahoo! Finance when discussing market outlook.

EV companies have rallied recently, but CIO Stephanie Lang, CFA cautions that when valuations are stretched and without basis, things could end badly for investors. Read her take on the EV space here.