Making Alternative Investments a Priority

Making Alternative Investments a Priority

Financial advisor Angie Spielman recommends a 33% allocation to alternative strategies.

Advisor
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Reviewed by: etf.com Staff
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Edited by: Mark Nacinovich

Angie Spelman headshot

Angie Spielman is the founding partner and a financial advisor at Manhattan West, a wealth-management and alternative-investment firm.  

She focuses on high-net-worth women and middle-market business owners, and she has a niche clientele. She works closely with clients and their outside advisors to manage assets and liabilities to provide comprehensive plans. 

Spielman specializes in helping women establish financial independence and build up their financial literacy, especially those who require estate planning guidance or have experienced a major liquidity event, such as a divorce, a spouse’s passing or the financial tailwinds of a business sale. 

The following is a conversation I had with Spielman about her investment strategy. 

Jeff Benjamin: How do you define alternative investment?  

Angie Spielman: An alternative investment is an investment that does not fall within the confines of a traditional public market investment such as an equity, fixed-income instrument or cash equivalent. Alternative investments are often private market investments.  

JB: Why do alternatives make sense in the current economy?  

AS: At Manhattan West, we believe that the private markets will outperform the public markets over the next 10-year period. For this reason, we recommend that every client should have some exposure to alternative investments assuming those fit within their risk profile and the client meets the criteria needed to invest. Last year’s market performance led to even more interest in alternatives. Right now, there's quite a bit of interest in private equity and venture capital.   

More broadly, we believe the new benchmark portfolio is 33%, 33%, 33%; with your assets divided equally between stocks, bonds and alternatives. I should note that this approach is on a client-by-client basis. Of course, for more risk-averse clients, we will keep them in more traditional portfolios.  

JB: What areas of alternatives are you using for your clients?  

AS: We offer clients personalized in-house portfolios comprising of assets in private equity, venture capital real estate and private debt. Our clients have exclusive access to proprietary investment opportunities in alternatives across these four asset classes.    

JB: Do clients ever balk at the higher fees?  

AS: I have not had that experience yet. With a 1% and 10% or 2% and 20% structure, I explain that the annual management fees of these products cover the overhead of the team and costs associated with keeping the fund open. In my opinion, the carry keeps the client and the firm’s incentives aligned. The manager makes money when the client does.  

JB: Can you offer access to retail class investors?  

AS: Our proprietary alternative investment products are only offered to investors who meet necessary qualifications and most of our clients fall within this category. However, it’s important to note that when working with clients of any size, it’s prudent to take time and start slowly when introducing alternatives to their portfolios. Clients come to us because they know we can provide access to private investments, and we can often get clients involved at smaller check sizes to get started.    

Contact Jeff Benjamin at [email protected] and find him on X: @BenjiWriter 

Advisor Views is a bi-weekly Q&A-style series that features voices from across the financial planning industry sharing insights on investment strategy and portfolio management as it relates to the current economic environment.

The format enables advisors to respond in their own words to specific questions designed to provide readers with practical tools and tactics that can be applied to managing client portfolios.