A new survey from private market investment platform Yieldstreet suggests a significant majority of retail investors intend to either maintain or increase their private market allocations, with many using brokerage accounts to fund their investments.
The report titled "The Next Wave," conducted in partnership with a global consulting firm, drew from a survey of nearly 400 individual investors and industry experts.
The findings indicate that private market investments are increasingly being integrated into mainstream portfolios, particularly among investors utilizing digital investment platforms.
Among the respondents in Yieldstreet's report, 94 percent plan to maintain or raise their private market allocations. Those with more than $1 million in investable assets cited diversification as the top reason for investing in private markets (64 percent), followed by yield generation (53 percent) and lower correlation with public markets (27 percent).
“When provided access to private markets, investors are actively diversifying between their public and private market accounts to make sophisticated investment decisions across asset classes,” Michael Weisz, founder and CEO of Yieldstreet, said in a statement revealing the results.
The study found brokerage accounts were the primary funding source for direct-to-consumer private market investments, accounting for three-fifths (59 percent) of allocations. Within that group, 37 percent of investors use online brokerage platforms, while 22 percent invest through traditional full-service firms. Outside of brokerage platforms, the remaining 41 percent reportedly fund their private investments from savings and checking accounts.
Additionally, digital platform users displayed different investment preferences compared to other investors. Interest in infrastructure investments, for example, was reported at 22 percent among platform users, significantly higher than the 8 percent seen among non-users. There's been some significant action in the infrastructure investing space over the past year, with titanic asset managers including KKR and Blackstone focusing on the asset class as they set their sights on affluent investors in the retail space.
“The platforms that succeed will be those that deliver the intuitive, digital experience investors have come to expect, paired with institutional-caliber opportunities – enabling them to build diversified portfolios over time,” Weisz said.
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