Alternatives – What Advisors Need From Asset Managers’ Sales Teams

As alternative investments, such as interval funds, continue to become more popular, it is increasingly important for asset managers to engage financial advisors with solutions and services that overcome the problems advisors look to alternatives to solve: a need for diversification, reduced risk exposure and understanding how to achieve desirable liquidity levels in portfolios that contain alternative investments.

When asked, “When you hear ‘Alternative Investments,’ what type(s) of investments do you think of?” a majority of advisors mentioned private assets such as equity, real estate and credit. They were less likely to consider managed futures or multi-strategy funds.

Advisors most often (nearly 3 in 4 advisors) look to alternatives to provide diversification in their portfolios. Nearly half (47%) said that it was a way to provide risk mitigation. Advisors look to alternatives to diversify their practices, to attract or retain high-net-worth clients or because they hold a strong belief in the benefits of alternatives. But advisors also recognize several challenges to integrating alternatives into their portfolios, including the fact that alternatives can make it difficult to manage their clients' liquidity expectations.

Advisors are looking for providers who offer the strategy they want in the investment vehicle/wrapper they prefer, providers that offer strong, well-coordinated sales and support functions, and those that can provide expertise and tools to help integrate alternatives. But, beyond these attributes, the most commonly cited attribute of providers of alternatives solutions was that the advisor already has a relationship via other investments/allocations/services—one in four advisors said this was the most important attribute when assessing providers.

Advisors want providers that can supply client-ready materials that help them explain alternatives to their clients, detailed analysis of the product’s liquidity and how that impacts the liquidity of the client portfolio, and general education materials on alternative fund structures. In short, advisors want alternative fund providers to assist them in education around alternatives and how to use them without jeopardizing liquidity.

In summary, advisors want to use alternatives to improve portfolio diversification, but understand that doing so may make it more difficult to provide the level of liquidity their customers expect. They want providers of alternatives to be ready with materials that will help them explain the benefits while also addressing how to mitigate the risks of placing alternatives into portfolios.

To reach advisors with alternative funds, asset managers can leverage existing relationships to cross-sell alternatives so long as the manager has materials that can help advisors explain alternatives to their clients:

• client-ready materials that can aid advisors in educating their clients about alternatives
• detailed analysis of the product's liquidity and how that impacts the liquidity of client portfolios
• details about a product's portfolio constituents and performance

Educational materials are only part of the equation. Providing access to specialists, portfolio managers and investment strategists allows advisors to ask questions and gain a deeper understanding of where alternative investments fit within client portfolios. To get more information about advisors’ usage of alternative products, read about SS&C’s Distribution Solutions services.

Source:

SS&C’s Research, Analytics, & Consulting Advisor Insights 2026 Topical Survey, in association with Horsesmouth, 2025