Retail Investors Pouring Money Into Managed Wealth Solutions
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Blackstone Group (NYSE:BX), the world’s largest private equity firm, plans to 2X assets under management over the next 5 years, and it wants individual investors to get the action.
About 15 to 20% of Blackstone Group LP’s annual fundraising currently comes from retail investors, Joan Solotar, head of private wealth solutions at the firm, said in a TV interview Tuesday.
“There’s no reason that ultimately it won’t account for half the assets we manage,”Ms. Solotar said. Pressed for a timeline, she said, “I’m going to give myself a little more than 5 years. Let’s say 10.”
Retail investors have different concerns and priorities than institutional clients.
The 10-year lockup on traditional buyout funds, for example, can be difficult for individuals who have larger or more unpredictable cash needs than a pension or sovereign wealth fund.
Private capital vehicles also typically charge higher fees than liquid pools that individuals are accustomed to.
Ms. Solotar said Blackstone’s fees for retail offerings are “not all that different” from those for funds geared toward institutions.
Structures such as interval funds or private real estate investment trusts can help address individuals’ liquidity needs when investing in alternative assets, she said.
“We are targeting the $1 to $5-M investor,” Ms. Solotar said. “They are really under-penetrated in the alts business.”
Tuesday, the major US stock market indexes finished at: DJIA +9.36 at 24884.12, NAS Comp +41.30 at 7372.00, S&P 500 +7.18 at 2728.12
Volume: Trade on the NYSE came in at: 835-M/shares exchanged.
- NAS Comp +6.8% YTD
- S&P 500 +2.0% YTD
- DJIA +0.7% YTD
- Russell 2000: +1.7% YTD
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