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Alternative Investments

Benefits of Alternative Investments

Although each alternative investment differs in its risk/return characteristics, adding alternative investments to a traditional long-only stock and bond portfolio may provide the potential for diversification (however, diversification does not ensure against loss) and at least one of the following:

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  • Access to specialized investment managers
  • Low correlation with public stock and bond markets
  • Lower portfolio volatility
  • Tax efficiency
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Considerations

Although alternative investments have the potential to offer such benefits as higher returns and lower correlation with publicly traded securities, investors should be aware of potential risks associated with these investments:

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  • Long-term investment horizon
  • Lack of liquidity
  • Limitations on transferability
  • Limited access to performance and investment information
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Each alternative investment involves significant risks which are described in the applicable confidential offering memorandum. Qualified investors should not invest in any alternative investment unless the investors are able to sustain the loss of all or a significant portion of investment capital. Investors should be aware that they will be required to bear the financial risks of this type of investment for a substantial period of time, since many of these investments are illiquid for several years. In making an investment decision, investors must rely on their own examination of the person or entity creating the securities offered and the terms of the investment including the merits and risks involved. Please consult your Financial Advisor advisor to determine if alternative investment offerings are suitable for you and/or available in your country.

This site does not constitute an offering and is meant only to provide a broad overview for discussion purposes. All information provided here is subject to change. If and when an investment opportunity is structured, all investors must obtain and carefully read the related Offering Memorandum, which will contain the information needed to evaluate the potential investment and provide important disclosures regarding risks, fees and expenses. No offer of any interest in any product will be made in any jurisdiction in which the offer, solicitation or sale is not authorized, or to any person to whom it is unlawful to make such offer, solicitation or sale.

Investing in alternative investments is speculative, not suitable for all clients, and intended for experienced and sophisticated investors who are willing to bear the high economic risks of the investment, which can include:

  • loss of all or a substantial portion of the investment due to leveraging, short-selling or other speculative investment practices;
  • lack of liquidity in that there may be no secondary market for the fund and none expected to develop;
  • volatility of returns;
  • restrictions on transferring interests in the fund;
  • potential lack of diversification and resulting higher risk due to concentration of trading authority with a single advisor;
  • absence of information regarding valuations and pricing;
  • delays in tax reporting;
  • less regulation and higher fees than mutual funds;
  • and advisor risk.

Past performance is no guarantee of future results.

Investing in managed futures products is speculative, not suitable for all investors, and is intended for experienced and sophisticated investors who are willing to bear the loss of their entire investment. Performance of these products may be volatile, and while they may provide the potential for positive returns in both rising and declining markets, the potential for loss is equal. Some of the important risks are: trading profits and interest income may not offset substantial fees; the ability to redeem interests may be limited and there may be no secondary market; conflicts of interest may exist in the management of an investment vehicle; advisors may be changed without notice to investors; and the vehicle may not be registered under the Investment Company Act of 1940. See the relevant offering materials for further discussion of risks.

Please contact your advisor for more information about available products, services and research.

For more information, please contact your Financial Advisor.

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