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HNW Investors Must Raise Their Private Markets Ambitions – Hightower Advisors
Tom Burroughes
29 March 2024
There’s a relentless drumbeat of noise about the need for HNW individuals to ramp up holdings of private market and alternative assets to diversify and capture returns, but they’re still lagging behind large institutions.
And with so-called “evergreen," aka perpetual structures becoming a more prominent feature of the private markets space, there’s also a new way of accessing these relatively illiquid areas.
Robert Picard, managing director and head of alternative investments, accepting that illiquidity.”
The structure of American capitalism, in terms of how firms are owned, has shifted in the past four decades. There are fewer firms listed on US exchanges. In 1976, the US had 4,943 firms listed on exchanges. By 2016, it had only 3,627 firms. From 1976 to 2016, the US population increased from 219 million to 324 million, so the US went from 23 listed firms per million inhabitants to 11. (Source: National Bureau of Economic Research, 2018.) Instead, privately-held firms have become more significant. However, for years, investors have had to put up at least $1 million to enter private equity – and sometimes far more.
With the rise of fintech platforms such as iCapital and CAIS in the US, and Moonfare in Europe, there is a gradual shift toward improving access to private markets. Regulators such as the US : they become the bank,” he said.