The mainstreaming of private markets is creating a worrying illusion for retail investors
Private investments are becoming more accessible to retail investors, with lower minimums and simplified structures. However, this trend may create an illusion of liquidity and flexibility that does not reflect the reality of private markets. As conditions tighten, investors may find themselves unable to access their capital when they need it most.
- ▪Nearly half of Canadian advisers allocate 10 to 30 percent of client portfolios to private markets.
- ▪The Ontario Securities Commission is facing calls to broaden access to private investments for retail investors.
- ▪Recent events have shown that liquidity in private markets can evaporate when investors need it most.
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Open this photo in gallery:The Ontario Securities Commission has faced calls to make private markets easier for retail access.Melissa Tait/The Globe and MailShareSave for laterPlease log in to bookmark this story.Log InCreate Free AccountDavid MacNicol is president and portfolio manager at MacNicol & Associates Asset Management.Private investments are increasingly being marketed as the next frontier for retail investors. What was once largely reserved for institutions and ultra-high-net-worth investors is becoming far more accessible through lower investment minimums, simplified fund structures, and products offering periodic liquidity.
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