Define the intended role
Private markets, real assets and other alternative strategies can involve distinct sources of risk. Their place in a portfolio should follow a specific objective rather than the appeal of exclusivity.
Examine the constraints
Limited liquidity, leverage, uncertain valuations, long holding periods and complex fees may be material. Reported price stability does not necessarily mean economic risk is low.
Apply additional scrutiny
Eligibility restrictions and suitability considerations can be significant. Independent due diligence and a realistic ability to commit capital for the required period are essential considerations.