Some advisors tend to believe that alternatives are a panacea for diversification, risk management, and return enhancement, while other advisors believe that they are expensive and ineffective. Howe & Rusling is of the belief that although alternatives aren't appropriate for the majority of clients, for some clients, certain alternative investments can be a prudent addition to a portfolio. Such clients are generally ultra high net worth individuals or endowments for whom liquidity is not a concern. We look carefully how these investments fit with the client's other holdings and long-term objectives, make sure the client is being compensated for the illiquidity of the investments, and monitor the unique risks of these non-traditional investments that include real estate, private equity, and hedge funds.
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