The explosive growth of alternatives

Stropro Team
Stropro
Published in
3 min readJun 29, 2022

In 2008, as the global economy was sent into disarray, the alternatives market was largely unheard of or otherwise inaccessible to the global investor community. Representing a modest (by comparison to today’s market size) valuation of USD $3.1trn, most investor portfolios were allocated amongst traditional asset classes such as stocks, bonds and cash investments.

The GFC taught investors many lessons. Among them, the importance of portfolio diversification. Thus, it is no coincidence that today, the alternative investment market is worth USD $13.3trn — a 23.5% growth rate since the GFC. And by 2026, this number is set to grow to USD $23.2trn.

Blackstone, the largest alternative manager in the world, has been part of this explosive growth. Over the last 5 years, their private wealth FUM has grown from USD $58bn, to USD $220bn today. And Joan Solotar, Global Head of Wealth is on a mission to expand Blackstone’s reach “beyond institutional investors and into the portfolio of retail investors”.

While Stropro hasn’t yet reached retail investors, we have opened up access to the alternative investment market for sophisticated and wholesale investors. Where we first started that journey was with Structured Investments, the $10trn + market that many Australian investors are unfamiliar with.

Structured Investments

If you haven’t already picked up on it, the name “Stropro” was coined as a consequence of our particular affection for Structured Products. Prior to founding Stropro, Ben and I worked together at Citi Bank where we saw the growth of the investment book from AUD $400m to over $5bn in 5 years. Why were structured investments so popular?

They are a powerful way for investors to access defined risk and return outcomes. Being able to target a defined rate of return, buffer market volatility or capitalise on an emerging thematic can significantly optimise one’s portfolio risk and targeted return outcomes.

However during this growth journey, we continued to face challenges with processing and scaling the Citi business due to lack of technology. Recognising the market size opportunity of Structured Investments and Alternatives more broadly, we created Stropro.

Ultimately, the ability to construct a portfolio that is dynamic, robust and resilient to changing market conditions and opportunities means that structured investments should be considered in any investor portfolio.

Written by Anto Joseph

This article has been prepared by Anto Joseph. Anto Joesph is the CEO at Stropro Operations Pty Ltd (ABN 28 633 603 399) (Stropro). This article is for educational purposes and is not a substitute for professional and tailored financial advice. This article expresses the views of the author(s) at a point in time, which may change in the future with no obligation on Stropro or the author to publicly update these views. This article uses information from sources the author considers to be reliable but does not represent that such information is accurate or complete, or that it should be relied upon. Past performance is not a reliable indicator of future performance. Investments may rise and fall in value and returns cannot be guaranteed. Stropro makes no representations or warranties, express or implied, as to the accuracy or completeness of the information it provides. Stropro Operations Pty Ltd (ABN 28 633 603 399) is a Corporate Authorised Representative (CAR №1293257) of Stropro Compliance Pty Ltd (ABN 74 640 214 740, AFSL №533443).

--

--

Stropro Team
Stropro
Writer for

Stropro is Australia’s dedicated platform for sophisticated investors, we offer exclusive institutional opportunities from the world’s leading investment banks.