Alternative investments are becoming increasingly popular for investors looking to diversify their portfolios beyond traditional stocks and bonds. LPL Financial, one of the largest independent broker-dealers in the US, offers a wide array of alternative investment products and services to help clients access these markets. This article provides an overview of LPL Financial’s capabilities in alternative investments and how they can benefit investors.
LPL Financial’s alternative investment offerings
LPL Financial provides access to a multitude of alternative asset classes and strategies. This includes private equity, private credit, hedge funds, managed futures, commodities, real estate, and more. LPL works with hundreds of asset managers across alternatives to construct customized portfolios based on clients’ objectives. For accredited investors, LPL provides a platform of over 275 private alternative investments from top managers. The firm also offers liquid alternative mutual funds and ETFs that provide alternative strategies in a more accessible structure. LPL Financial has dedicated research analysts that provide insight, analysis and due diligence on alternative investment managers and products.
Benefits of alternative investments for LPL Financial clients
Adding alternative investments can provide several advantages for LPL Financial clients. First, alternatives offer diversification since they have lower correlation to traditional assets like stocks and bonds. This can reduce overall portfolio volatility. Many alternatives like private equity also provide potential for higher returns. Additionally, alternatives allow access to unique exposures that may not be obtained elsewhere, like cryptocurrencies, litigation finance, farmland, and more. LPL Financial has the resources and expertise to guide clients through the complexities of these investments. With LPL’s platform, clients can conveniently access alternatives to complement their broader investment strategies.
LPL’s approach to alternative investment due diligence
LPL Financial has a rigorous due diligence process for adding alternative investments to its platform. Their dedicated alternative investment research team conducts quantitative analysis on managers’ track records, strategies, and risk profiles. Qualitative assessments examine the investment team, operations, compliance and other factors. LPL also negotiates fee structures and leverages its scale to provide preferential pricing for clients. Ongoing monitoring ensures managers adhere to stated investment processes. Through this thorough vetting, LPL can identify high-quality alternative investments to meet clients’ financial objectives.
Working with an LPL Financial advisor on alternatives
Partnering with an LPL Financial advisor can help investors effectively incorporate alternatives in their portfolios. Advisors can educate clients on the risks and opportunities of various alternative assets and construct tailored portfolios to achieve their goals. They can also provide guidance on issues like liquidity, taxes, minimum investments and accreditation requirements. With LPL’s open architecture, advisors have the flexibility to select both LPL-approved and external alternative investments to meet clients’ needs. Investors benefit from customized advice and portfolios combining the optimal mix of traditional and alternative assets.
With its vast selection of alternative investments and rigorous vetting process, LPL Financial provides investors access to this fast-growing asset class through trusted managers. LPL’s platform and guidance enables clients to capitalize on the portfolio diversification and return potential offered by private equity, hedge funds, real assets and other alternative strategies.