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Solving “The Data Problem” Holding Financial Advisors Back

According to EY data:

  • 81% of ultra-high-net-worth clients hold alternative investments. 
  • 51% of very-high-net-worth clients hold alternative investments.
  • 29% of high-net-worth clients hold alternative investments. 

And financial advisors are doing their best to keep up, with limited resources and solutions thus far.

According to a recent study by Cerulli, financial advisors reported a 14.5% average allocation to alternative investments in client portfolios, expressing desire to hit closer to 17.5% over the next two years. 

Still though, plenty of roadblocks between advisors and alts remain. But what exactly is holding them back? 

What’s holding advisors back from offering alts?

According to a recent CAIS survey, here are the most popular barriers between financial advisors and alts offerings: 

  • 70% of financial advisors report a lack of education about alternatives.
  • 37.6% are concerned about increased administration and paperwork.  
  • 34% report due diligence concerns and complicated compliance processes.   

Not to mention, there’s a data problem in alts, creating entirely different sets of challenges that have been hard for advisors to break through.

An automated data solution for financial advisors and their clients' alternative investments.
Source: Unsplash

Up until now, most advisors (and their clients) are tracking alternative investments manually via spreadsheets and uploading data from PDF statements, because that’s the only way it’s been made available.

A solution for structured alts data 

Gone are the days of tracking alts via spreadsheets and collecting complicated PDF statements.

At AltExchange, we’ve automated alternative investments, providing structured, standardized data for all private market investments including private equity, hedge funds, real estate, startups and more.  In addition, we provide a fully-managed client onboarding process, automatically collect tax documents, and provide actionable insights for advisors and their clients, all on one platform.

If you’re interested in automating your clients’ alternative investments, please book a call or schedule a demo to learn more.

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