Uncover the power of private assets in meeting long-term goals efficiently. Learn how a holistic approach balances liquidity needs, risk, and performance in investment portfolios.
Private assets and alternative investments are usually illiquid in nature but can help an investor meet their long-term objectives more efficiently. Allocating to illiquid investments necessitates managing liquidity risk in portfolios to ensure that sources of liquidity are sufficient to meet the various uses of liquidity, such as spending and uncalled capital.
Effective liquidity management requires a holistic framework that considers the interplay among top-down asset allocation, bottom-up cash flow modeling, and market scenario analysis. By incorporating the client's liquidity preferences and specific details about the private asset program, investors can build portfolios that meet their liquidity needs while aligning with their risk preferences and performance objectives.