Bespoke Alternative Investments
What is a “Bespoke Alternative Investment”?
The term “alternative investments” (or “alts”) is often used but rarely fully understood. Unfortunately, this term is too broad and can encompass a large range of possible investments and security types. We, at Arete Wealth, want to be as specific and descriptive as possible in describing what we mean when we use the term.
First, let’s take the word “bespoke.” This word is defined as being tailor-made for a particular customer or client. We use this word to demonstrate that, at Arete, we source and offer our clients investment products that are either offered at very few boutique broker-dealers and RIA firms or that one can only find at Arete Wealth. For example, there are many publicly traded Real Estate Investment Trusts (REITs) that are available at every major broker-dealer and RIA in the United States. While some may call this an “alternative investment,” it most certainly is NOT “bespoke.” This is a mass-available investment. Conversely, most of the “alts” available on the Arete platform are much smaller, more targeted, more transparent, easier to underwrite, and may have greater risk-reward potential. At Arete, our bespoke offerings are like the custom-tailored suit made just for your measurements rather than the off-the-rack suit that is sold in bulk.
When we speak of an “alternative investment,” we are usually referring to private and mostly less-liquid investments that have very little correlation to publicly traded investments. We are looking for the same or similar “alts” that university endowments and large family offices are looking for. Examples of the asset classes that we consider to be truly “alternative” would include litigation finance funds, middle market senior debt funds, diversified blue-chip art funds, property-specific opportunity zone deals, oil and gas royalty funds, venture capital funds, etc.
If you are looking for this kind of tailored approach, contact an Arete affiliated advisor.
Disclaimer
When considering alternative investments, you should consider various risks, including the fact that some products use leverage and other speculative investment practices that may increase the risk of investment loss, can be illiquid, are not required to provide periodic pricing or valuation information to investors, may involve complex tax structures and delays in distributing important tax information, are not subject to the same regulatory requirements as mutual funds, often charge high fees, and, in many cases, the underlying investments are not transparent and are known only to the investment manager. With respect to alternative investments in general, you should be aware that returns from some alternative investments can be volatile and you may lose all or a portion of your investment.
Past performance of any investment is not indicative of future results. You should only commit risk capital to a fund investment. Alternative investment products, including hedge funds, are not for everyone and entail risks that are different from more traditional investments. You should obtain investment advice from your advisors before deciding to invest.
This website is intended for informational purposes only.
