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How Financial Advisors Can Maximize Returns in a Recession

With inflation at a 40-year high, public markets down 20%, and surging interest rates, alternative investments have become essential to hedging against today’s poor economic environment. Yet many financial advisors still aren’t offering them.

Here’s how advisors can offer and easily track, manage, and report alternative investments to maximize their clients’ returns during a recession. 

Popular alternatives right now

While many advisors still aren’t touching alternatives, many are expressing interest in offering them in the future.

According to a recent Cogent Syndicated report, here are the alternative investment categories advisors are paying the most attention to right now:

  1. Real assets/commodities (29%): Referring to basic goods, typically raw materials, such as oil, gas, metals, corn, soybeans, and gold.
  2. Real estate/REITs (26%): Real estate investments include physical properties such as single and multi-family homes, commercial buildings, land, infrastructure, and more. REITs are real estate investment trusts that a company owns in order to generate income-producing profits. 
  3. Other alternatives (22%): “Other” alternative investments is a broad category, but a few popular examples include private equity, private credit, hedge funds, startups, and more.
Source: Unsplash

Platforms offering access to alternative investments

While access to alternatives had been limited to accredited investors in the past, there are many platforms that have expanded access for both advisors and their clients.

Among advisors who are offering alternative investments right now and using our platform, here are the top integrations we’re seeing:

  1. Juniper Square
  2. Carta
  3. Appfolio
  4. iCapital
  5. CrowdStreet

How advisors can manage, track and report alternative investments 

Offering access to alternatives is only the first step in achieving results during a recession. As accessibility increases, so does complexity and fragmentation, calling for more advanced aggregation services especially for advisors managing a breadth of alts portfolios.

Most financial advisors who offer alternative investments are still tracking data manually via spreadsheets from scattered PDF documents. But it doesn’t have to be this way.

AltExchange's AdvisorVue client dashboard showing alternative investment performance details.
AdvisorVue client dashboard

AltExchange automates alternative investment workflow for financial advisors through our technology-powered platform, AdvisorVue. With AdvisorVue, advisors can provide family office-like services with:

  • Real-time reporting and consolidation of all clients’ alternative investments.
  • Historical reporting on existing investments.
  • Automatic collection of tax documents (K1s, 1099s).
  • Fully-managed capital calls (automated reminders & notifications).
  • Integrations with existing wealth management systems (e.g. Addepar, Black Diamond), allowing advisors to bill for individual investments or account-wide.

If you’re an advisor looking to maximize returns and gain an edge in your business with alternative investments, please get in touch.

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