Alternative investment strategies have been embraced by a range of investors over the past decade, largely on the basis of their ability to target specific needs to diversify portfolios.
Putnam now offers a new research study with insights that can help set performance expectations for alternative strategies under actual market conditions.
Taking a methodical approach, the study classifies alternative strategies into four key investment objectives —
Return Enhancers, Inflation Hedges, Volatility Dampeners/Risk Reducers, and Zero Beta/Zero Correlation objectives.
Each objective is then analyzed in real economic scenarios of the past 20 years to highlight its strengths and weaknesses during four different periods of growth and inflation. The approach yields insights for both returns and risk-adjusted returns.
The conclusion offers observations for portfolio strategies and indicates the objective with the best long-term risk-adjusted performance.
Financial professionals: Read Putnam's new research, Alternatives in Action, for the full analysis of alternatives in real market conditions of the past 20 years.
For informational purposes only. Not an investment recommendation.
This material is provided for limited purposes. It is not intended as an offer or solicitation for the purchase or sale of any financial instrument, or any Putnam product or strategy. References to specific asset classes and financial markets are for illustrative purposes only and are not intended to be, and should not be interpreted as, recommendations or investment advice. The opinions expressed in this article represent the current, good-faith views of the author(s) at the time of publication. The views are provided for informational purposes only and are subject to change. This material does not take into account any investor’s particular investment objectives, strategies, tax status, or investment horizon. Investors should consult a financial advisor for advice suited to their individual financial needs. Putnam Investments cannot guarantee the accuracy or completeness of any statements or data contained in the article. Predictions, opinions, and other information contained in this article are subject to change. Any forward-looking statements speak only as of the date they are made, and Putnam assumes no duty to update them. Forward-looking statements are subject to numerous assumptions, risks, and uncertainties. Actual results could differ materially from those anticipated. Past performance is not a guarantee of future results. As with any investment, there is a potential for profit as well as the possibility of loss.
Diversification does not guarantee a profit or ensure against loss. It is possible to lose money in a diversified portfolio.
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