Alternatives Industry Targets Individual Investors

The rush for individual investors to invest in alternatives is accelerating, with firms like KKR, Blackstone, Apollo, and Ares focusing on individuals with assets between $1 million and $5 million. Wealth managers are facing challenges in incorporating alternatives into client portfolios, with only 2.3% of U.S. financial advisor assets invested in illiquid alternatives in 2023. KKR has suggested sophisticated wealthy investors allocate up to 30% of their portfolios to alternatives and has provided frameworks for creating alternative portfolio allocations ranging from 10% to 30%. Individual investors and their advisors understanding how to better utilize well-formulated alternatives in their investment portfolios is seen as a positive development.