Private markets on the rise with wealth managers, says Delio report
Private markets are on the rise among wealth managers, according to a new report from private investment infrastructure service Delio.
The report reveals that wealth managers are increasingly looking to establish or grow private market propositions with nine out of ten of those surveyed already offering private market propositions or planning to launch one. Direct investments and impact investments are also emerging more prominently in the market.
A key driver for this change in attitude is client demand, as a third of private clients’ wealth is now allocated to private assets. Structural changes within the industry, such as increased commoditisation and competition; a shift towards more holistic advice; and the increasing importance of entrepreneurial clients, have led wealth mangers to pay closer attention to this demand to meet the needs of their clients.
Delio’s report estimates that the popularity of the offering will continue to grow and evolve due to competition and the risk of losing clients. The consequences of providing private market solutions are become apparent: one in four wealth managers surveyed admitted to losing a client by failing to embrace this market.
Although private assets are increasingly on wealth managers’ agendas, several challenges limit wealth managers from launching or scaling an offering. While regulation remains a key factors, a lack of internal resources and expertise limit wealth managers without a private market proposition from establishing one.
David Newman, Co-Founder and Chief Commercial Officer at Delio, says: “Our results highlight that Wealth Managers increasingly understand the role private assets play in attracting and retaining clients.
“As the number of institutions creating or scaling private market propositions continues to grow at an unprecedented rate, wealth managers must evolve to stay relevant to clients and keep pace with the competition. At Delio, we understand how technology can help overcome many of the challenges cited by wealth managers, and we are proud to support our clients in responding to this trend.”