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Private Investments: A Unique Approach

What got you here may not get you there… Why private investments are an important part of a balanced portfolio

It has been a remarkably rewarding 40 years for investors in public stocks and bonds. As interest rates declined from over 15%, expanding earnings multiples propelled public equity returns well ahead of underlying earnings growth. Bond investors have been equally rewarded as declining interest rates consistently drove up the value of their fixed income portfolios. Fast forward to today; interest rates are approaching zero percent and the prospects for further significant revaluation of public stocks and bonds are becoming challenged.

With this backdrop, many of North America’s wealthiest families and sophisticated pension funds are introducing private investments into a diversified portfolio of public stocks and bonds in order to enhance returns and lower volatility.

Although growing in popularity, private investments have, until recently, been beyond the reach of the average high net-worth investor. Fortunately, financial disintermediation has allowed forward-thinking families and firms to begin to benefit from the enhanced returns and lower volatility offered by these asset classes.

For a better understanding of private investments and how they improve overall portfolio performance, Focus has produced a short video explaining why this asset class is such an important part of a diversified and balanced portfolio. Contact us at info@focusasset.ca to request access to the full video.

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