Private equity corporations, which have largely combined fundraising with institutional investors, are now turning to individual investors.
Many businesses consider it to be capable of obtaining financing from these investors. It appears like there is a lot of space, especially among wealthy investors.
According to Capgemini, individuals from all over the world with at least $1 million of assets raised $79.6 trillion in investmentible assets in 2020. According to the Wall Street Journal
Private-equity firms have calculated that under 5% of the kitty is invested with them.
Get Blackstone Inc. Report, the largest private equity firm, offers several funds for the Average Joe.
Blackstone Offerings
Get Blackstone Altrnt Multi-Strategy Fund, a mutual fund offering a range of alternative-asset investments, has no minimum investment, according to Morningstar. It has nonetheless achieved a 1.56% annualized return over the past five years.
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Blackstone Real Estate Investment Trust BREIT, a non-traded REIT, has a minimum investment of $2,500. It produced a annualized return of 14.5% for the five years through April 30, according to the S&P 500. The five years ended June 7, a slightly different period.
BCRED, a Blackstone private credit firm, has a $2,500 minimum. In the 12 months ended May 30, the company''s institutional shares offered a return of 8.5 percent.
Bang for the Buck?
The amount of bang you get for your buck in these types of funds is unclear. They generally haven''t been around long enough to judge their performance in a bear market, and many haven''t shown the same signs in the recent bull market.
Alternative-asset enthusiasts believe that these assets serve as a diversifier for investors'' portfolios. However, they may also serve as an accelerator of returns, both on the downside and.
The stock of Blackstones has risen 27.81% in the past 10 years, almost double that of the S&P 500, which has had 14.43% increase. In 2008, the S&P, excluding dividends, dropped 37%, while Blackstone also dropped 67 percent.
Alternative assets, such as real estate, private equity, commodities, and credit services, may be quite volatile. Before you jump in to alternatives, make sure you understand the risks.
The author of this documentary owns the shares of Blackstone.
