Diversification in Private Markets

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In this report we consider the role of diversification for investors in alternatives, identifying asset classes with historically low correlation and presenting Preqin data alongside public equity and 60/40 portfolio benchmarks

Diversification in alternatives is supported by access to earlier-stage companies and diverse earnings profiles, among other factors
Real assets tend to exhibit low correlation to public equities and 60/40 portfolios, which helps with downside risk management
Investing in private markets creates need to manage cash flow diversification across strategies and vintages