The S&P 500 tumbled 20% during the first six months of 2022, its worst first-half decline in half a century. Meanwhile, the bond market experienced its worst decline on record. A typical portfolio of 60% stocks and 40% bonds produced its worst return since the Great Depression.
The lackluster returns and nauseating volatility are leading more investors to seek alternatives to the public stock and bond markets. They're increasingly allocating more of their portfolio to alternative investments like private equity, hedge funds, real estate, and infrastructure. Prequin, a leading data provider to the alternative asset community, sees investments in alternatives rising to more than $17 trillion by 2025, a roughly 10% annual growth rate from 2020's level. That should drive continued growth for leading alternative asset managers Blackstone (NYSE: BX) , Brookfield Asset Management (NYSE: BAM) , and KKR (NYSE: KKR) .
Blackstone is the king of the alternative asset management sector. The company ended the second quarter with an industry-leading $940.8 billion of assets under management (AUM).
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The $17 Trillion Market Opportunity You Can't Afford to Miss