Alternative investments are those made into any asset class that falls outside of the three traditional ones - stocks, bonds and cash. Private equity is the main category within alternative investing.
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Alternative asset investments provide diversification to investors' portfolios because of their reduced correlation to public markets.
Diversification simply means that you are not putting all your eggs in one basket. So when you diversify when creating an investment portfolio, it can create a more favourable risk/return ratio.
Historically, private equity has the highest annualised return compared with all other asset classes, public or private. Combined with a volatility that is far lower¹ than any asset class that gets even close to the same return, the result is a compelling risk-return profile.²
The Moonfare platform pools commitments from all its individual investors into Luxembourg-based feeder funds, which invest directly into the underlying target funds.
This structure facilitates lowering minimum investments to a level that fits individual investors, while safeguarding their capital.
¹ Private Equity lower volatility can be partially explained by its lack of obligation to mark-to-market on daily data. Harris, Robert S., Tim Jenkinson, and Steven N. Kaplan. 2014. “Private Equity Performance: What Do We Know?” Journal of Finance 69(5).
² https://www.kkr.com/global-perspectives/publications/wisdom-compounding-capital
³ For reference only. Moonfare investments are offered in USD and EUR. Minimum investment may vary by country and local regulation.
