Wealth Management

In an article for MarketWatch, Morey Stettner discussed various options for alternative investments including non-traded real estate, private debt, venture capital and hedge funds. The asset class delivered strong returns in 2022 especially compared to stocks and bonds. 

Looking ahead to the next decade, alternative investments are expected to fare better especially as they offer diversification to investors with the potential for higher returns. The traditional 60/40 allocation does not seem sufficient for a higher-rate, higher-inflation regime, and alternatives could be one solution for advisors to help clients reach their goals. 

There are also some additional considerations about alternatives that advisors need to understand. For one, money isn’t immediately deployed especially in private equity and venture capital. Additionally, money often cannot be immediately redeemed, while there is less transparency about pricing in less liquid markets. 

Many investors see opportunities in private real estate and venture capital especially as savvy managers will be able to take advantage of the dislocations in these arenas. Many also believe the asset class would outperform in a recession or inflation scenario which would likely continue to be a major headwind for stocks and bonds. 


Finsum: Alternative investments continue to attract interest especially due to stocks and bonds coming off a poor year in 2022.

In a Barron’s article, Lauren Foster discussed some ESG recommendations for 2023 from TD Cowen. The bank sees upside for ESG in 2023 due to an increasing focus on energy security, long-term decoupling from fossil fuel, and government-led investments in energy infrastructure. They identify six companies that offer the best combination in terms of ESG metrics and traditional investing factors: Air Products & Chemicals; Norwegian start-up FREYR Battery (FREY); Hannon Armstrong Sustainable Infrastructure Capital;Itron (ITRI), Piedmont Lithium (PLL); and Stem (STEM).

Air Products & Chemicals is the largest of these companies with a $66 billion market cap. TD Cowen notes its critical role in terms of boosting hydrogen production capacity which is a priority for the Biden Administration. It sees the company as being a potential leader in this space given its multiple projects throughout the Middle East and North America. 

Notably, many of the companies on Cowen’s list are down considerably given the underperformance of growth stocks since interest rates started moving higher. While there are some headwinds for ESG investing due to a more polarized political climate, Cowen sees the long-term drivers of demand as only strengthening in the coming years. 


Finsum: TD Cowen sees ESG picks as having upside in 2023. Here are 6 of its top selections.

In an article for InvestmentNews, Bruce Kelley discussed some of the collateral effects of First Republic’s troubles. Since these issues began in early March, around a third of the company’s advisors in its wealth management division have left the firm.

Following JPMorgan’s takeover of the bank, filing show that 150 advisors remain at the firm, while there were around 230 at the beginning of the year with about $271 billion in total assets. According to JPMorgan, many of the 150 advisors intend to stay on and transition to JPMorgan’s wealth management division. 

The bank also revealed that it plans to honor any recruiting deals that were struck by First Republic. Notably, First Republic had been quite aggressive in recruiting clients from banks and smaller firms. Ironically, it had recruited about 40 advisors from JPMorgan since 2010. 

JPMorgan’s acquisition should stem the tide of advisors leaving First Republic. In April, a team of First Republic advisors, managing $10.8 billion in assets, departed for Morgan Stanley. Prior to this, another team, which managed $2.3 billion in assets,  was picked off by Rockefeller Global Family Office.


Finsum: One of the consequences of the failure of First Republic bank is that many advisors are leaving for greener pastures. But, the JPMorgan acquisition may put a stop to this.

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