The Role of Alternative Investments in Diversifying Portfolios: Insights from UBS Asset Management
UBS Asset Management emphasizes the importance of alternative investments in diversifying portfolios and capturing unique sources of return. Mariana Paul, a private markets partner at UBS O’Connor, highlighted the benefits of alternatives in a recent interview ahead of her session at the Australian Wealth Management Summit 2024.
Paul explained that traditional 60/40 portfolios have struggled to provide the expected risk-adjusted returns and diversification, especially in the current market environment. With the breakdown of the correlation between stocks and bonds, investors are increasingly turning to alternative investments to seek better returns and yields.
Interest in alternative investments has surged since the COVID-19 pandemic, with strategies like multistrategy macro trend funds proving successful in navigating volatile markets. Paul emphasized the importance of considering factors such as investment objectives, risk-adjusted returns, and liquidity constraints when diversifying into alternatives.
From private equities to hedge funds, alternative investments offer a range of options for investors looking to expand their portfolios. Paul highlighted the potential benefits of hedge funds in navigating market uncertainties and the opportunities for income and wealth growth in private markets like private equities and real estate.
UBS Global Wealth Management’s model portfolio allocates around 40% to alternatives, with a focus on hedge funds and private market funds. This allocation serves as a diversifier to traditional equities and bonds, providing investors with a more balanced and resilient portfolio.
The partnership between UBS and the Australian Wealth Management Summit offers a platform for institutional and wholesale investors to explore a wide range of investment strategies. The summit aims to delve into key investment themes and strategies that are top of mind for the investment community in 2024.
To learn more about the role of alternatives in modern portfolios, attendees are encouraged to join Mariana Paul at the Australian Wealth Management Summit 2024 on Wednesday, 8 May at The Star, Sydney. Tickets are available for booking, and more information on the agenda and speakers can be found on the summit’s website. Don’t miss out on this opportunity to gain insights into the evolving landscape of alternative investments.
