Financial Advisors Gain Access to Private Equity Using Alternative Investment Platforms

Financial Advisors Gain Access to Private Equity Using Alternative Investment Platforms

Alternative investment platforms are giving financial advisors access to private-equity investments that typically require large sums of money and a three to five year lock-up period.

Private placements are not advertised or purchased on the open market and often consist of accredited and institutional investors. Alternative investment platforms are making it easier for financial advisors to offer private equity investments to their clients. These platforms negotiate which private equity funds are added to the platform. They are able to offer access to a diversified menu of private funds and negotiate lower investment minimums, all while integrating custodial reporting and electronic subscription processing. Furthermore these platforms conduct due diligence on the investment, all while linking to custodians to allow advisors to include private investments in client portfolios.

Private equity investments may be an unfamiliar marketplace for advisors, which is why investment platforms are likely to help financial advisers better navigate the investment. These alternative investment platforms introduce independent research on the funds that will be offered over the platform, which is expected to lead to more private equity fund offerings.

Since the 1970s the size of the private equity market has steadily grown and is becoming a more popular investment. In 2014, the Cambridge Associates U.S. Private Equity Index returned 11.25%, net of all expenses and fees. That’s in comparison to the 13.69% gain in the S&P 500 Index.

Private placement investments in a self-directed IRA accrue retirement income on a tax-deferred or tax-free basis. These alternative investments offer the client diversity in investment portfolios which is essential to the growing success of retirement planning. To learn more information, or to start investing in private equity, call Midland IRA at 239-333-1032 or visit

Sources:, 2015, Investopedia, LLC., Private-equity investing made easy for financial advisors, 6/18/2015