But he does think that such asset classes should be approached with extreme caution by direct investors, and even some professionals.
He says: “I would argue that it is not the investor’s place to fully understand the investment itself at an intrinsic ‘advice-giving’ level; what are they paying advice for?
“However, I would suggest that they may be too difficult for less educated and aware advisers to use. A simple solution is for the adviser to do sufficient due diligence before recommending.
He advocates that before buying into such funds, advisers must have an “awareness of the return anticipation and profile, an understanding of the asset class, an understanding of the manager process and ongoing knowledge of the manager’s current view and positioning versus the macro environment”.
