What’s Shaping the Future of Alternative Investments?

In recent years, we’ve seen a growing preference among institutional investors and high-net-worth individuals for more personalised investment solutions. There’s been a move away from traditional pooled funds towards vehicles like funds-of-one and special purpose vehicles (SPVs). This desire for direct ownership is also clearly evident in the increasing interest in tokenisation.

Curious to know more? A new article by Elliot Refson, Head of Funds, and Philip Pirecki, Americas Lead, explores these growing trends: Growing Demand for Direct Ownership and Customisation.

Understanding this evolution is essential for staying competitive. Here are some key insights from the article, which was first published by Real Asset Advisor:

• The use of separately managed accounts has steadily increased, with Cerulli Associates projecting that assets managed under these vehicles will surpass US$2 trillion this year
• Funds-of-one and SPVs allow for tailored strategies that align with the individual goals, risk appetites and time horizons of the investor
• This customisation also comes with enhanced transparency, as investors have clearer insight into their capital allocations
• Tokenisation, meanwhile, continues to attract attention and offers similar benefits to funds-of-one, notably more direct ownership, customisation and transparency
• Digitising traditional real assets and trading these assets on blockchain platforms democratises access, enabling broader and more active participation in previously exclusive asset classes
• Tokenisation provides access to assets that were previously difficult to trade, leveraging key DeFi technologies to enable investors to gain exposure to high-value assets with lower capital thresholds
• Challenges remain. Funds-of-one and SPVs can involve higher administrative costs and complexity, and the digitised space is navigating an evolving regulatory landscape
• Against this backdrop, it’s essential for investors and managers to partner with the right domiciles. Jurisdictions like Jersey are establishing frameworks and guidance to bring clarity to the tokenised sector

Contact Elliot Refson or Philip Pirecki to discuss the topics raised in the full article.