Charles Schwab and State Street Global Advisors have separately launched new offerings aimed at widening access to private markets for retail clients and defined contribution plan participants, underscoring a growing trend among large firms to incorporate alternatives into mainstream portfolios.
On Thursday, Schwab announced the full rollout of its Schwab Alternative Investments Select platform, making it available to retail clients with more than $5 million in household assets.
Initially piloted to a smaller segment in October 2024, the platform offers a curated shelf of third-party funds across private equity, hedge funds, private credit and private real estate, with ongoing due diligence conducted on the underlying funds. The firm said it plans to expand the platform over time to include exchange funds and additional offerings within each asset class.
iCapital provides the technology infrastructure, digitizing enrollment and streamlining investment execution. Schwab clients will also have access to the firm’s team of alternative investment consultants, in addition to their existing wealth management professionals.
In a recent survey of high-net-worth clients on its platform, Schwab found more than half expect to allocate at least five percent of their portfolios to alternatives within the next three years.
According to Head of Investor Services Jonathan Craig, Schwab serves more than a million multimillionaire investors, representing over $3 trillion in assets.
State Street Global Advisors, meanwhile, launched its Target Retirement IndexPlus Strategy, a new target-date offering that blends traditional index-based exposure with private market investments. Each fund will allocate 90 percent to public market index strategies managed by State Street, and 10 percent to private markets through a pooled investment vehicle managed by Apollo.
In February, State Street took a leading position in the race to launch a private-credit ETF. After an initial false start with the SEC flagging concerns over the fund's underlying liquidity, branding, and ability to comply with rules around valuations, the SPDR SSGA Apollo IG Public & Private Credit ETF was launched on February 27, though it received a tepid initial response.
These moves reflect a broader industry shift to integrate private markets into wealth and retirement portfolios, historically dominated by public market assets. While private equity and credit have long been reserved for institutional and ultra-wealthy investors, technology partnerships and pooled structures are making them more accessible.
The moves from Schwab and Apollo also come shortly after BlackRock launched a series of new customizable model portfolios in partnership with iCapital and GeoWealth, offering private market exposure within a unified managed account structure. It broadened out exposure to those portfolios on Wednesday through a strategic collaboration with Envestnet, putting them within reach of the RIAs within the wealth tech giant's platform.
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