Alternative investments
Private markets and hedge funds present the opportunity for investors to significantly expand their investment opportunity set, with the potential to tap into the major growth drivers of the future economy, and achieve greater diversification, crucial to achieving greater portfolio resilience.
However, in an increasingly complex and crowded investment universe, the ability to identify and access managers is becoming even more challenging for asset owners. We believe successful implementation depends on four key areas:
The future of private markets
Types of alternative investments
Private markets
Private markets offer diversification away from listed markets and the potential for compelling risk-adjusted returns. They also offer an illiquidity premium and have the potential to provide greater protection from market shocks.
Hedge funds
Hedge funds represent an investment tool that can provide diversification (relative to both equity and interest-rate risk), with minimal trade-off in return.
Benefits of alternative investments
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New ideas, innovation and diversification
With moderate correlation to traditional asset classes, alternatives can diversify your portfolio and introduce new innovative ideas and strategies. -
Potential for better returns
Alternative investments offer a different return profile for an institutional portfolio. They tend to have low correlation to stocks and bond markets, adding diversification or hedging against market downturns. -
Integration of sustainable and impact investing
There are a growing number of sustainable investing strategies in private markets. These offer the potential for you to address your business objectives and develop a holistic plan that seeks to reduce risk while maximizing returns.
Three considerations for alternative investments
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A Partner to Your Alternatives Portfolio
We partner with our clients with the goal of building innovative, resilient and agile portfolios designed to deliver their individual governance and investment needs.
A total portfolio approach is in Mercer’s DNA – for over 80 years we’ve been a trusted partner for institutions, helping them achieve their overarching investment objectives. This requires a culture of collaboration whereby asset class specialists are aligned with total portfolio outcomes rather than siloed single-asset success measures. Our investment staff have an integrated way of assessing opportunities and exposures at the total portfolio level, with governance frameworks that can adapt to help ensure portfolios are best positioned for the evolving market environment.
Alternative Investment Strategy Objectives
Private Markets
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Private Equity
A principal return driver of long-term growth portfolios. -
Co-investments
A flexible tool for improving portfolio efficiency and enhancing returns. -
Secondaries
Opportunistic access to high-quality companies. -
Infrastructure
Long-term predictable inflation-linked cashflows. -
Private Debt
Liquidity, income generation and downside protection. -
Real Estate
Dual-income and capital appreciation potential. -
Impact Investing
Private markets opportunities designed to strike a balance between potential returns and real world outcomes.
Partnering with institutional investors across industries
Our alternative investments approach can flex to suit you
- 1 Client-centric flexible approach
- 2 Extensive research platform
- 3 Global reach, local resources
Diversify your portfolio with private markets
Our team
We're here to help you accomplish your investment goals
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