Equity Mates Investing Podcast Ask an Adviser: The news rules of portfolio construction - Daniel Kelly | Viola Private Wealth
May 12, 2025
Daniel Kelly, Chief Investment Officer of Viola Private Wealth, shares his insights on updating traditional portfolio strategies. He discusses the importance of adapting to market volatility and capitalizing on downturns. Kelly emphasizes the role of alternative investments in building resilience and highlights the significance of rigorous fund evaluation and the need for expert guidance. He also explores the rise of private credit and infrastructure, along with the transformative role of AI in investing, advocating for a tailored, long-term approach to asset allocation.
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Evolving Portfolio Construction
- Portfolio construction is evolving beyond the traditional 60/40 equity/bond split to include 30-50% in alternative investments.
- Alternatives reduce volatility impact and enhance risk-adjusted returns by providing emotional dampening and diversification.
Rigorous Manager Due Diligence
- Conduct thorough due diligence on fund managers, investing 40-60 hours to uncover red flags beyond marketing materials.
- If lacking expertise, stick to well-known reputable funds for alternative investments.
Manage Illiquidity Risks
- Understand illiquidity risks in alternative investment funds with NAV gates limiting redemptions.
- Build liquidity considerations into portfolio construction to avoid forced fire sales during market stress.