Power players transforming alternative investments at top wealth and asset managers
- Mainstream retail investors are trying to get into private market investments.
- Wealth and asset management firms are trying to meet clients' demand with new products and hires.
Investors are flocking to the growing world of private markets.
Asset managers and wealth management businesses have been scrambling to keep up with the demand from investors seeking alternatives to mainstream mutual funds and ETFs and looking to tap into big names staying private for longer.
Asset managers are increasingly focused on developing new alternative investments, namely private equity and credit, and getting those out to wealth-management firms, financial advisors, and their clients.
Wealth managers are also seeking to bolster their menus with products that were previously considered too risky or expensive for client access.
Insider has been tracking how firms have been transforming their businesses to meet client demands and the people leading the charge.
From private equity giants like Apollo Global Management to massive money managers like BlackRock, firms have been ramping up their distribution efforts.
In May, Apollo Global Management formed a unit to sell more of its products to wealth managers and individual investors. That month, Pimco hired executives from Blackstone and Wells Fargo to lead similar efforts. In June, T. Rowe Price poached a Pimco executive to oversee alternatives distribution. And KKR's private-wealth team has tripled in size in the past year.
Insider has pinpointed key leaders pushing asset managers' alternatives products to clients.
Meet the 9 gatekeepers of alternative investments at the largest wealth firms
Analysts expect wealth managers' allocations to alternatives for their clients to continue to grow. Morgan Stanley and Oliver Wyman pegged illiquid assets and alternative assets for the ultra-high-net-worth set to increase to $24 trillion in 2024 from $16 trillion in 2020.
Meanwhile, the US government has worked to get private equity and credit into the hands of small-time investors by loosening restrictions on what qualifies a person to invest in the space and allowing private equity in some retirement funds.
An enormous amount of due diligence and risk management is required when allowing more exotic investments into the hands of financial advisers' clients as they can often be illiquid and less transparent.
Insider has identified major wealth managers' top executives responsible for overseeing the menu of alternative investments that firms and their advisers can choose for clients.
Meet 17 BlackRock power players carrying out CEO Larry Fink's vision to turbocharge the firm's $222 billion alternative-investments business
The business of offering clients nontraditional assets like private equity, hedge funds, and real estate has become a core part of BlackRock's long-term growth plan.
Insider broke out the 17 most powerful leaders powering the growth within the asset manager's alternative-investments business, which oversees about $253 billion in assets as of June.
The alternatives unit accounts for just 3% of BlackRock's overall assets. But it is still a giant: by assets under management, the business is roughly the size of the private equity firm Carlyle.