More Americans with at least $5 million in investable assets are willing to put money in alternative investments than they were five years ago, according to the Wealth in America study by Northern Trust released Thursday.
Thirty percent of high-net-worth investors say they are more inclined to consider alternatives now than they were five years ago, the study shows. Private equity tops the preference list at 35 percent, followed by managed futures (32 percent), REITs (28 percent), hedge funds (23) percent, and venture capital (17 percent).
More than a quarter (28 percent) say limited partnerships are their preferred legal structure for holding these investments, the survey shows.
“While not suitable for everyone, alternative investments can provide portfolio diversification as well as offer exposure to sources of return not available from traditional stocks and bonds,” says Katie Nixon, Northern Trust’s CIO for wealth management. “Given our goals driven investing approach, we believe every asset class has a unique role in a portfolio, including alternatives."
The survey showed 63 percent of high-net-worth investors are likely to take calculated risks in order to grow their wealth and 52 percent say they plan to look for new investments.
The survey also found that one in five high-net-worth investors holds jewelry, art and antiques and other collectibles as part of their portfolio.
More than half of couples (56 percent) discuss how to manage their wealth at least once a quarter, the survey shows.
In addition, 59 percent are willing to pay for advice from a financial advisor and 81 percent say life goals such as good health and traveling the world are highly important considerations in developing their financial plans, but they are less confident of achieving those goals than they were in 20007.
Northern Trust is a wealth management firm based in Chicago with $197.7 billion in assets under management.