Navigating Alternative Investments in Wealth Management

Welcome back to the Alt Goes Mainstream podcast.

On today’s episode, we are joined by Mercer Investments’ US Financial Intermediaries Leader Gregg Sommer and CAIS’ MD and Head of Investments Neil Blundell.

Gregg and Neil bring deep experience and backgrounds in private markets to discuss how alternatives can be further adopted by the wealth channel.

Gregg is Mercer’s US Financial Intermediaries Leader, serving US wealth management and family office clients. He is a member of Mercer’s Wealth Leadership Team, Wealth Management Strategic Research and Investment Committees, and the Investment Policy Committee. He joined Mercer’s Investments business in 2009 and is based in Denver. Gregg began his career at U.S. Trust and over the last 35 years has held several executive positions in the investment industry. He has a comprehensive investment, business, and risk management background and has managed many successful investment teams focused on risk assessment, asset allocation, due diligence, portfolio management, organizational evaluation, and financial analysis across both private and public investment strategies. Gregg served as Chief Financial and Operating Officer of a firm that managed real estate and private equity and debt portfolios and has been a Principal and Portfolio Risk Officer for RCM, a Commodity Trading Advisor. Additionally, he was a founding Partner at Global Trading Partners, a trading firm focused on global market relationships.

Neil brings over 20 years of experience in private markets to CAIS. He recently worked at Invesco as the Global Head of Client Solutions and Alternatives for the Investment Solutions team. He was responsible for developing and managing over $90B in customized multi-asset investment strategies spanning both traditional and alternative solutions and was a member of the team’s executive committee, investment committee, and chair of the alternative investment committee. Prior to Invesco, Neil was at BlackRock for 10+ years, where he was most recently Managing Director and Alternatives Platform Head within the Institutional Client Business.

Gregg, Neil, and I had a fascinating discussion about how the wealth channel can approach alternatives and how they can think about both diligence and customization. We covered:

• The case for alternatives.
• How advisors currently approach alternatives and how they can think about it differently going forward.
• How to think about portfolio construction that includes alternatives.
• How alts can help advisors differentiate their practice and attract clients.
• Following the fast river in a career and why alternatives are “the fast river.”
• The meaning of “structure over strategy.”
• The rise in popularity of evergreen funds.

Thanks Gregg and Neil for coming on the show to share your views and experience in private markets. We hope you enjoy.

A word from AGM podcast sponsor, Ultimus Fund Solutions

This episode of Alt Goes Mainstream is brought to you by Ultimus Fund Solutions, a leading full-service fund administrator for asset managers in private and public markets. As private markets continue to move into the mainstream, the industry requires infrastructure solutions that help funds and investors keep pace. In an increasingly sophisticated financial marketplace, investment managers must navigate a growing array of challenges: elaborate fund structures, specialized strategies, evolving compliance requirements, a growing need for sophisticated reporting, and intensifying demands for transparency. 

To assist with these challenging opportunities, more and more fund sponsors and asset managers are turning to Ultimus, a leading service provider that blends high tech and high touch in unique and customized fund administration and middle office solutions for a diverse and growing universe of over 450 clients and 1,800 funds, representing $500 billion assets under administration, all handled by a team of over 1,000 professionals. Ultimus offers a wide range of capabilities across registered funds, private funds and public plans, as well as outsourced middle office services. Delivering operational excellence, Ultimus helps firms manage the ever-changing regulatory environment while meeting the needs of their institutional and retail investors. Ultimus provides comprehensive operational support and fund governance services to help managers successfully launch retail alternative products. 

Visit www.ultimusfundsolutions.com to learn more about Ultimus’ technology enhanced services and solutions or contact Ultimus Executive Vice President of Business Development Gary Harris on email at gharris@ultimusfundsolutions.com.

We thank Ultimus for their support of alts going mainstream.

Show Notes

00:00 Introduction to Sponsor, Ultimus Fund Solutions

01:17 Podcast Opening and Guest Introduction

01:58 Guest Backgrounds and Career Highlights

03:43 Discussion on Wealth Channel and Alternatives

03:51 The Case for Alternatives

07:47 The Evolution of Private Debt

08:23 The Moment It Clicked for Alts

12:08 Institutional vs. Wealth Channel Approaches

13:54 Educating the Wealth Channel

15:47 Evergreen Funds and Wealth Channel

19:29 Generational Wealth Transfer

20:04 Current Market Trends and Private Markets

25:29 Importance of Due Diligence in Alternatives

26:33 Advisor Allocation Trends

26:53 Expected Allocations in the Next Year

27:07 Private Equity and Credit Insights

27:17 Real Estate and Hedge Funds Outlook

27:27 Emerging Infrastructure Strategies

27:47 CAIS Platform Overview

28:17 Transactional Volume Trends

28:36 Registered Funds Growth

29:30 Institutional vs. Wealth Channel Behavior

30:25 Customization in Private Markets

31:22 Technology's Role in Wealth Management

35:52 The Importance of Brand in Investments

39:26 Strategic Partnerships in Wealth Management

39:56 Concerns About Private Markets Growth

43:36 Evaluating Manager's Edge

45:54 Future of Alternative Investments

Disclosure

This content is for institutional investors and for information purposes only. It does not contain investment, financial, legal, tax or any other advice and should not be relied upon for this purpose. The materials are not tailored to your particular personal and/or financial situation. If you require advice based on your specific circumstances, you should contact a professional adviser. Opinions expressed are those of the speakers as of the date of the recording, are subject to change without notice and do not necessarily reflect Mercer’s opinions.