Using Alternative Investments- How do you compare to other advisors?

American Century Investments recently released their Financial Professionals Alternative Investments Study detailing how advisors are using alternative investments in their business. I encourage you to contact your American Century wholesaler for a copy of the study if you are interested in this topic. For more information, click on the link below.

The study found the use of alternative investment strategies to be widespread with 80% of advisors currently using with clients. The most popular strategies were precious metal and natural resource strategies which were being used by 40% of advisors using alternative strategies.

With that said, for me the most interesting data in the study is contained in the appendix when it provides details of how advisors responded to the survey based on average account size and asset under management (AUM) demographics. One might think the more successful the advisor the higher likelihood they are using alternative investment strategies and sophisticated products to implement those strategies. However, advisors with more than $100million in AUM having clients with average account sizes greater than $1million actually use less alternative investment strategies than their peers. In fact, advisors with more than $100million in AUM were statistically the least likely to use alternative investment strategies than any advisor demographic. So much for the notion that working with high net worth investors absolutely requires access to sophisticated alternative investment products.

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