Alternative assets are now mainstream – but should you buy in?

Alternative assets such as infrastructure, debt and private equity, traditionally help diversify a portfolio away from listed equities. Max King takes a look at some of the best investment trusts in the sector.

HS2 workers © ISABEL INFANTES/AFP via Getty Images
Invest in infrastructure to diversify your portfolio © Getty
(Image credit: HS2 workers © ISABEL INFANTES/AFP via Getty Images)

Investment trusts are widely assumed to be investment vehicles investing in listed equities. However, at the start of this year, “alternative assets” accounted for 39% of the £165bn sector. And the proportion continues to grow steadily – the sector accounted for more than 70% of share issuance in 2019.

The “alternatives” umbrella covers funds invested in areas such as infrastructure, property, renewable energy, bonds, debt and specialist finance, as well the older established areas of private equity and hedge funds.

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Max King
Investment Writer

Max has an Economics degree from the University of Cambridge and is a chartered accountant. He worked at Investec Asset Management for 12 years, managing multi-asset funds investing in internally and externally managed funds, including investment trusts. This included a fund of investment trusts which grew to £120m+. Max has managed ten investment trusts (winning many awards) and sat on the boards of three trusts – two directorships are still active.

After 39 years in financial services, including 30 as a professional fund manager, Max took semi-retirement in 2017. Max has been a MoneyWeek columnist since 2016 writing about investment funds and more generally on markets online, plus occasional opinion pieces. He also writes for the Investment Trust Handbook each year and has contributed to The Daily Telegraph and other publications. See here for details of current investments held by Max.