Unlisted Assets

“Like a good wine, the best vintages in private markets often come from challenging environments,” Franklin Templeton’s Tony Davidow says, predicting the recent dysfunction markets have endured could mean a strong vintage year for private equity.

For investors looking for alternatives to equities and fixed income, listed investment companies and trusts provide diversification and short-dated exposure to long-term investment strategies, not to mention inflation protection, industry leaders said at a recent event.

With private equity becoming more accessible, retail investors can now take advantage of the asymmetry-of-information and diversification benefits PE offers, while its safe-haven characteristics stand out in the uncertain macro environment, according to David Chan and Cameron Brownjohn.

At The Inside Network’s Alternatives Symposium, Kyle McCarthy and David Lewis encouraged investors to define private credit very broadly to reap the benefits of diversification and strong risk-adjusted returns.

The amount of capital being made available to private companies has surged in recent decades, making it possible, and often preferable, to keep companies private for much longer. Liberty Street Advisors’ Christian Munafo and Schroders’ Claire Smith discussed the opportunities and risks for investors as the private-for-longer trend picks up pace.

The prudential regulator will more closely examine the valuation methodologies super funds deploy to value private assets to address an emerging gap between the performance of listed and unlisted property.

Increasing government expenditure on social infrastructure is driving huge levels of investment into the sector. There are now several options for retail and wholesale investors to gain exposure to this asset class, which was previously open only to institutional investors.

Senior secured loans act as an important inflationary hedge in times of rising inflation according to Invesco’s chief investment officer.

The Reserve Bank of Australia (RBA) board raised its official cash rate last week for a third consecutive month. The bank has adopted a dovish stance saying future hikes are “not on a pre-set path” and that the economy will likely slow as a result of these hikes.

Most readers will own unlisted assets via their superannuation fund. Here we provide an overview and break down the advantages and downfalls of investing in the asset class.