Real estate and life settlements are the alternative asset classes set to benefit the most as professional investors review allocations, according to new research from Managing Partners Group, the international asset management group.
Nearly half (47 per cent) of professional investors questioned (pension funds, family offices, insurers and wealth managers) by MPG across Switzerland, Germany, Italy, the UK and the US expect allocations to real estate to increase dramatically over the next three years while 45 per cent believe allocations to life settlements will see major growth.
MPG’s research with wealth managers and institutional investors who are collectively responsible for GBP258 billion assets under management shows hedge funds will also see dramatic increases in allocations with 44 per cent forecasting major shifts in allocations.
The study found less support for commodities and high-yield bonds. Around a third (33 per cent) predict dramatic increases in allocations to commodities while 28 per cent believe high-yield bonds will see dramatic growth in allocations.
The research for MPG finds 10 per cent of professional investors do not know which asset classes will see dramatic increases in allocations.
Jeremy Leach, Chief Executive Officer of Managing Partners Group comments: “The alternatives sector is growing rapidly with assets under management (2) expected to expand to USD23.2 trillion by 2026 amid increased interest from retail investors and HNW individuals. That is driving increased allocations to separate asset classes with real estate, life settlements and hedge funds set to be the biggest winners over the next three years.”