Strategies for Expanding Private Markets in Wealth Management

An excellent foundational MSCI Inc. research guide for wealth managers on increasing private market exposure. This data-based report offers a detailed look at the strategies and fund structures in the space, as well as the mindset required to build a portfolio allocation. Report answers key questions like:  - How do I choose a strategy and fund structure that fits my clients’ goals?  - How can I plan for capital calls, liquidity needs, and performance dispersion over time?  - What’s the difference between IRR and other return metrics — and how do I interpret them? Wealth managers are facing a growing client demand to increase exposure to private markets. MSCI Wealth’s latest guide, featuring insights based on one of the world’s largest private asset datasets, offers in-depth insights on liquidity, performance, and fund structures to advisers. Explore the guide here: http://ms.spr.ly/6046sBkRu #financialservices #privatemarkets #data #analysis #performance #strategy #mindset #wealthmanagement #wealthmanagers #RIAs #HNW #portfolioconstruction #assetallocation

The launch of JP Morgan Private Markets Fund earlier this month was the asset manager’s latest offering in the race to make alternatives more accessible. Excerpt of Wealthmanagement.com interview with Shawn Khazzam, head of private wealth alternatives, J.P. Morgan Asset Management WealthManagement.com: The other recent product is focused on private equity. What kinds of opportunities in the PE space is that entity targeting? Shawn Khazzam: We are very focused on the small and middle markets. Unlike many other players, that is the heritage of our private equity group. It has been investing in small/mid market opportunities for the better part of 40 years. It’s similar to the story with real estate. It’s about taking the knowledge and experience that had been managed on behalf of institutions and a good amount of private wealth and putting it in a more accessible vehicle. We think there is a strong opportunity set that is less reliant on leverage and many exit opportunities. There’s a really interesting opportunity that is quite complementary to more large-cap oriented strategies. WealthManagement.com: In research that we and others have done, some of the consistent sticking points we have found, in addition to education, which we’ve talked about, is liquidity. Is it also something you found? Shawn Khazzam: That is consistent. Top concerns are liquidity, education and valuations in today’s market. And whether the risk/reward is able to get them where they want to be. If you look at advisors across country, you have a classic 80/20 scenario. Most of the firms that we speak with are looking for our help to help expand alternatives use to more advisors rather than deepen to ones that already do a lot of alternatives. That’s where I think having built up relationships with advisors in past decades gives us an interesting perspective in being able to achieve those goals. The importance of distribution continues to grow over time as alternatives become more mainstream as you see their use expand.

📈 Strategic Insights for 2024: Navigating the New Normal in Private Markets and Beyond 📊 As growth leaders, understanding the broader business landscape is crucial, especially considering the evolving challenges and opportunities in private markets. A recent article from McKinsey sheds light on "Ten Considerations for Private Markets in 2024," offering valuable insights not just for private equity markets but for middle-market companies across various ownership structures. Key Considerations for 2024: 1️⃣ Normalizing Dealmaking: Expect a balanced growth in dealmaking, influenced by LP-driven pressures and higher interest rates. 2️⃣ Challenging Fundraising Environment: The 'numerator effect' continues, with fresh LP commitments constrained by valuation growth and slow PE exit velocity. 3️⃣ Concentration Among Larger Names: Larger funds may continue to attract LPs in a tight fundraising environment, limiting new-fund formation. 4️⃣ Emphasis on Value Creation: Transformative change becomes crucial for value boost, with low rates and expanding multiples no longer tailwinds. 5️⃣ Evolving Talent Challenges: The industry faces diversity, equity, and inclusion progress, alongside retention challenges in downturns. 6️⃣ Creative Sourcing: Opportunities may arise from family-owned businesses and corporate carveouts, favoring those with deep networks. 7️⃣ Infrastructure Investing Acceleration: Expanding definitions and uncorrelated returns drive increased LP exposure to infrastructure. 8️⃣ Private Credit Growth: Higher rates enhance the attractiveness of private credit, with banks limiting lending. 9️⃣ Real Estate Deal Volume Recovery: Predictability in living, working, and shopping trends may stabilize rents and encourage deal activity. 🔟 Secondaries Market Expansion: Near-record secondary fundraising could influence private markets, offering liquidity solutions for GPs and LPs. Your (and your customers') CEO, CFO, and Board are discussing these items and making decisions on them. These considerations underscore the importance of adaptability and strategic foresight for sustaining growth and achieving business objectives in the changing landscape of 2024. Remember, balance is a Verb: The concept of balance in business is dynamic, requiring continuous adjustment and alignment with evolving market conditions. This perspective is crucial for effectively managing the multitude of factors influencing company and customer decisions. 👇 For a deeper dive into these insights, see the full article linked in the first comment below. Call to Action: What market and economic trends do you believe companies need to be aware of in 2024 that may be currently under the radar? #BusinessStrategy #MarketTrends #PrivateMarkets #VentureCapital #talentmaximization #executivesearch