Beyond the public markets: What the rise of alternatives means for banks, advisors and wealth managers.

In recent years, the structure of capital markets has quietly but profoundly changed. 

Once, investors relied primarily on publicly traded stocks and bonds to meet their long-term objectives. Today, however, with only 13% of U.S. companies with $100 million or more in revenue listed publicly, traditional portfolios may no longer offer the breadth or diversification they once did.¹

At the same time, demand for alternative investments—spanning private equity, private credit, hedge funds, and evergreen vehicles—is surging. Globally, in 2024 these assets accounted for more than $19 trillion, with industry forecasts pointing to significant growth, particularly in the advisor-led wealth segment.²  According to recent projections, private market assets are expected to grow at more than twice the rate of public assets.³ 

What’s driving the shift?

Several structural and behavioral trends are converging. First, companies are staying private longer, delaying IPOs or skipping them altogether due to regulatory complexity, cost, and strategic flexibility. That means many of today’s most dynamic companies are accessible only through private markets.

Second, financial advisors and institutions are seeking enhanced portfolio outcomes—return, income, and diversification—amid persistent volatility and lower expectations for traditional asset classes. For many, alternatives offer differentiated exposure and long-term potential that public markets alone cannot match.
Access is evolving

Yet despite strong demand, a major gap remains in actual adoption. Roughly half of all advisors still allocate nothing to alternatives.² Why? Historically, it's been about access, complexity, and lack of familiarity.

Encouragingly, that’s starting to change. With the emergence of evergreen structures, secondary markets, and improved technology platforms, liquidity and usability barriers are slowly being addressed. Meanwhile, education and portfolio construction support are helping more institutions and advisors understand how to effectively use alternatives—not just what they are, but when and why they make sense.

A new portfolio paradigm.

As wealth managers, advisors and trust companies reimagine client portfolios, they’re increasingly integrating public and private market exposures into a unified investment strategy. The future may not be a 60% equities/40% fixed income model, but a “public/private blend” aligned to each client’s risk, return, and liquidity profile.

This evolution has big implications for the broader industry. Banks and trust firms that can offer thoughtful access to private markets—along with the operational infrastructure to support it—stand to differentiate their platforms, deepen client relationships, and expand revenue opportunities.

That means building internal fluency, reassessing legacy constraints, and working with partners who understand both the complexity and the opportunity. As the line between traditional and alternative continues to blur, one thing is clear: staying competitive in wealth management increasingly means stepping beyond the public markets.

¹ S&P Capital IQ Apollo Chief Economist April 20, 2024
² The Cerulli Report – U.S. Alternatives 2024
³ “Private market assets to grow at more than twice the rate of public assets, reaching up to $65 trillion by 2032, Bain & Company finds,” Bain, August 21, 2024

This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. This information should not be relied upon by the reader as research or investment advice. This information is for educational purposes only and should not be interpreted as legal opinion or advice.

The strategies discussed herein are complex and not suitable for all investors. Diversification may not protect against market risk.

Alternative investments are subject to a complete loss of capital and are only appropriate for parties who can bear that risk and the illiquid nature of such investments.

Alternative investments:
- often engage in leveraging and other speculative investment practices that may increase the risk of investment loss
- can be highly illiquid
- are not required to provide periodic pricing or valuation information to investors.
- involve complex tax structures and delays in distributing important tax information
- are not subject to the same regulatory requirements as mutual funds; and 
- often charge high fees.

Information provided by SEI through its affiliates and subsidiaries.