LGT Crestone and investment specialist Partners Group have unveiled a new diversified alternatives fund.
The wealth management firm has launched the PG3 Longreach Alternative Strategies Fund with exclusive access for its clients.
It was developed in partnership with PG3 AG, the alternatives investment specialist of Swiss-based Partners Group AG, and local alternatives asset manager Longreach Alternatives.
The fund offers access to a select group of idiosyncratic and traditionally hard-to-reach asset classes with low correlation to both traditional and private market investments.
In particular, the product’s multi-strategy and multi-manager exposure focuses on all three of PG3’s key investment areas: insurance finance, royalty finance and litigation finance. These strategies serve as risk and return drivers and effective portfolio diversifiers.
Commenting on the fund launch, LGT Crestone head of private markets, Martin Randall, said: “Diversification is fundamental to our investment philosophy. Alternative investments like private markets and unlisted real assets have certainly helped diversify portfolios in recent years, however, they often share similar market-related and/or economic sensitivities with traditional assets.
“Private equity is still equity after all, so when you strip out differences in valuation approaches, the underlying risk factors are the same and should be considered as such when building well diversified portfolios.”
What sets the fund apart, Randall added, is its ability to diversify portfolios through several idiosyncratic return streams which are uncorrelated to both traditional and alternative assets, consequently representing an ‘alternative’ to traditional alternatives.
Urs Wietlisbach, co-founder of Partners Group, noted the long-standing relationship between the firm and LGT Crestone.
“However, this custom-built solution is the first time we have made these three combined strategies from our own family office, PG3, available in a way that is a true reflection of the founders’ portfolio, taking the same unconstrained relative value approach across the three strategies.
“These three strategies have provided a consistent source of returns to our family office during significant market downturns, such as throughout COVID. Our approach ensures flexibility to effectively navigate evolving market conditions,” he described.
Sam Edwards, managing director at Longreach Alternatives, described the fund’s natural alignment to LGT Crestone’s offerings.
“Longreach’s long-standing relationship with LGT Crestone speaks to their position as a leader in private markets, making them an ideal partner for delivering such an innovative alternative investment solution. We’re confident that this collaboration will empower high-net-wealth investors with access to a truly unique investment opportunity,” he said.
Nearly 20 per cent of LGT Crestone’s $30 billion in assets under management is allocated towards alternatives. Meanwhile, LGT globally has more than $500 billion of client assets under management.