According to FlexFunds, trade wars, a slowdown in global economic growth, longevity or disruptive technological advances are some of the factors of greatest uncertainty in the market, which might eventually give rise to volatility episodes, such as those occurred in 2018. Fear of a new recession will set the 2019 market pace.
In this context, attention is increasingly addressed to alternative investments or assets – products that provide the appropriate flexibility to leverage market opportunities and, at the same time, seek risk protection in times of volatility.
The alternative investment industry has become a significant part of the financial system and global economy. According to an Intralinks study, 66% of investors plan to increase alternative investment allocation in 2019. In a scenario where flexibility and dynamism will be key tools to attain positive results, asset securitization programs have the necessary resources to take a defensive position against market volatility and, at the same time, provide an opportunity to access investment projects that are uncorrelated to secondary markets.
According to an S&P study, in the US, the total volume of securitized assets issued in the first half of 2018 was USD 284 billion, an increase of 16% compared to the same period in 2017.
FlexFunds’ asset securitization program for financial institutions, hedge funds, real estate and a range of asset managers, facilitates distribution and access to investment opportunities. Securitization allows creating a listed security from any underlying asset, which is distributed to banking platforms through Euroclear. Therefore, these investment vehicles may be accessed by investors from all over the world through already existing brokerage and private banking accounts. Furthermore, asset securitization provides a flexible tool to raise capital in any sector, including alternative asset investments.
There is a wide range of alternative investment options, which may be a powerful tool to help investors achieve a greater diversification, minimize volatility impact on their portfolios and enhance performance.