Building Better Portfolios With Private Markets

This report outlines a goals-based framework for integrating private market investments like private equity and credit into diversified portfolios to enhance risk-adjusted returns.

Key Takeaways

• 1.Asset allocation is the primary determinant of long-term investment success, explaining 90% of return variability.
• 2.The democratization of private markets through 'evergreen' funds (interval and tender-offer) allows individual advisors to access institutional-grade illiquid investments.
• 3.Advisors should implement an 'illiquidity bucket' (typically 10-20% for HNW investors) to capture the illiquidity premium over a 7–12 year horizon.

Table of Contents

• Goals-based investing
• The appeal of private markets
• How much should advisors allocate to illiquid investments?
• Due diligence and risk considerations
• Portfolio construction
• Benefits of adding private markets
• Case studies
• Key takeaways
• Contributor
• Endnotes
• Appendix

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