Investment opportunities have been constantly rising year by year, and 2024 is no exception. However, the scope of expansion—especially in the types of investments—has witnessed massive growth. Alternative asset classes and valuations have been increasing. Relative target allocations aren’t largely diverse from 2023, but the portfolio diversification has significantly brought returns.
Opportunities especially for High Net-Worth Individuals are widely open with a range of asset allocation. Enhanced revenue growth from investing in highly dominant equities has resulted in better returns. The several asset classes (PE, VC, Public Market, Credit, Real Estate, etc,) allows diversification especially with large holding capacity for better return ratio. Navigating such classes are now frequent in 2024 which till the previous year was looked at as a risk factor.
There’s a lot of advice out there that emphasizes skepticism, but it often goes unheeded. For UHNWIs the selection of funds might get biased based on their, finding the proper funds or market to invest in required cherry picking through private wealth managers. Xerxes Soli Mullan, founder of Avestar Capital has often stated that Private Equity Funds are the boon that results with the ongoing technological advancements, opening a plethora of options in the world of emerging companies.
Private Market Investments
Investment cases in the private market typically involve an above-market growth and margin expansion over multiple years. If private companies rise through the ranks much quicker than their market counterparts can command for higher returns and closures. It creates a much higher disparity of investment when compared to public companies, leading in higher valuation for private equity funds.
Analyzing the market in the current quarter of the year have shown increased potential in return of investments from private markets. North America is a leading hub with increased diversification of portfolios via the private market through several distribution channels. The liquidation ratios are higher, offering better returns compared to public investment options.
Private equity has seen constant growth since the decline in previous years. The deal-making has risen year-on-year within the first quarter of 2024. HNWIs are to be gained since the increases are in deal size rather than deal numbers. Optimism for such advancement has created excellent buyout options with improved and result-yielding exit frames, spiking the deal ratios.
Another significant transformation is done by credit funds, emerging as key players in non-public market investments. Providing capital support and higher leverage in buyouts, recapitalization with improved and flexible finance solutions. Credit lending gap which is left by banks can now be filled with such investing options, though comes with risk, often results in better returns with impressive stakes buying options as well.
Geographic diversification, especially in the Asia-Pacific (APAC) region has shown significant capital reserves for a flexible market in private credit. Allowing opportunist investors via private wealth managers in the USA to diverge the crowded market of US and Europe to venture into cross-border investments of Singapore, India, South Korea and Japan. This strategically based APAC’s geography captures dynamic results.
ESG (Environmental, Social & Governance) investing that allows companies to score on such responsibility metrics to gain potential investments. Each criteria examines their view towards suppliers, customers, employees, environment, community and much more. Better scoring companies often yield better ROI.
Private RIA and Their Significance.
Independent wealth management firms like Avestar Capital have the potential and expertise to produce much exciting contingency in Private Market Investments. Offering HNWIs unique and diversified investment opportunities unlike traditional investment avenues. Such independent RIA provides greater flexibility, allowing individuals to customize as per their needs for significant tailored approaches to market conditions.
Multi-Family Offices services are well-positioned to access a broader range of private investments, from early-stage startups to private equity and venture capital, that provide highly diversified investment options to their UHNWI families.
Mitigating risks unique to private market investment needs independent wealth managers for their hands-on approach. The rigorous due diligence, examining financial, operational, and industry risks to enhance the likelihood of strong returns while safeguarding client capital.
Avestar Capital’s Personalized Private Market Expertise
Avestar Capital’s president, Shilpa Mullan emphasizes personalized client experience. Their commitment to such an approach tailor’s investment strategies to align with risk tolerance, financial goals, and market outlook. This customized attention ensures that investments remain in sync with evolving financial landscapes.Independent wealth management firms like Avestar Capital combine industry insights, agility, and a client-centric approach to navigate the complexities of private market investments. Their specialized expertise makes them invaluable partners for individuals and families seeking to diversify and grow their wealth beyond traditional markets.