Back to all articles

Joining forces: Alternative assets in a traditional portfolio

| Alternatives, White papers

Executive Summary

By Client Solutions & Research at Sanlam Investments

By understanding alternative asset price formations and their relationships to traditional assets, investors are able to better understand the value of including each alternative asset that is available to them into a portfolio. Here we specifically consider the benefits of including hedge funds, real assets or African private credit into a traditional portfolio.

We find that for growth-focused portfolios, higher returns are delivered at lower volatility over longer investment horizons (periods of more than 10 years). Whereas for income-focused portfolios, there are significant benefits in the form of improved yields, through the inclusion of vehicles such as unlisted credit. But the fact remains, for most complementary portfolios containing a mix of growth, income and protection assets, alternative assets provide additions that enhance returns, reduce portfolio volatility and bring greater diversification to the portfolio.

Print Friendly, PDF & Email
Show Comments

Leave a Reply

Your email address will not be published. Required fields are marked *

More in Alternatives, White papers
Sanlam Intelligence
Areas of Indifference: Measures to compare similar portfolios.

An area of indifference is a method used to compare the characteristics of an investor’s current portfolio to characteristics for...