Alternatives will be 24% of global investment market by 2030
“The dozen years since the Global Financial Crisis, when so many markets were moving up in lockstep, perhaps gave investors a false sense of security and caused them to be less focused on such key concepts as diversification, volatility, price discovery, and liquidity; COVID-19 has brought them all back into play with shocking swiftness,” said William J. Kelly, CEO of the CAIA Association.
The report, The Next Decade of Alternative Investments: From Adolescence to Responsible Adult, looks back at 15 years of alternatives together with the insights of the survey to make some predictions about the years ahead.
For example, it suggests that efforts to “democratize” access to private equity and venture capital will lead to broader access to beta rather than alpha, a point that the industry must be prepared to explain to investors.
It also concludes that regulators globally will be forced to address perceived inequities driven by the acceleration of investors’ shift towards private markets.
Real estate challenges
For the venture capital market, the industry will need to face up to price discovery and transparency issues that has led to the WeWork situation last year.