USA TODAY | Kyle J. Russell Contributor
For both seasoned and new investors, the current market can feel overwhelming, filled with the potential for volatility and unpredictability. The traditional approach often includes a 60/40 portfolio, which sees investors dividing their assets between equities and bonds, respectively. This is done to hopefully reduce risks and build long-term wealth. But for current investors, this usual method may not be enough considering factors like high interest rates, which decrease bond prices, and stock market volatility.
Because of the potential need for a new investment plan, private alternative investments are seeing a surge. Options for this include private equity, real estate, private debt, and commodities. Investors are increasingly turning to these options to diversify and protect their portfolios. Founder and managing principal of F Street, Scott Lurie, highlights the benefits of this investment type. He says that private alternative investments are less directly tied to changes in the overall market and can provide a cushion against volatility.
The Shift Away from Public Markets
According to Lurie, the efficiency of public markets, while beneficial for stability, often caps the potential for significant outperformance. “In public markets, everything is immediately priced in, which is a testament to their efficiency but also a limitation for growth,” Lurie explains. This is where private alternatives come into play, providing access to investments outside the typical stock and bond markets, such as private equity, private credit, and real estate.
F Street’s Innovative Approach
Founded in 2009, F Street has been at the forefront of integrating private alternatives into broader investment strategies. The firm specializes in private equity, credit, and real estate, aiming to build a robust portfolio with better potential to thrive under economic pressures. “Our approach is about understanding deeper market forces and leveraging less tapped areas to secure stronger returns for our clients,” says Lurie.
Recently, F Street, in collaboration with CKO Real Estate, launched the VAM Fund 1 LLC, a value-added multifamily equity investment focused on the burgeoning renter market spurred by rising home mortgage rates. F Street also launched two new multifamily development opportunities. Lurie notes, “This initiative reflects our commitment to seizing timely market opportunities, as we look to build nearly 300 new units to enrich southeast Wisconsin’s housing landscape.”
