Advisors Have Increased Private Market Investment Options
Financial professionals are offering more private assets, but many remain wary of fee transparency and liquidity risks.
Updated on Oct. 13, 2026 in Financial Planning
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Financial advisors are increasingly incorporating private market investments into client strategies, with 40% of advisors now offering these products. This shift follows efforts by large firms to package private equity, credit, and real estate into more accessible model portfolios.
Why it matters
While alternative investments outperformed equities and bonds in 2022, many advisors report declining confidence in explaining these complex holdings to clients. Concerns remain regarding the underlying transparency of these assets and the potential for limited liquidity.
Currently, 40% of advisors offer private-market investments, yet 46% cite concerns about fees and 40% flag limited liquidity as a significant issue. Financial professionals typically recommend allocating 5% to 20% of a client portfolio to these alternative asset classes.
The players
Morgan Stanley
A global financial institution that provides wealth management services and develops model portfolios for retail investors.
Morningstar
An investment research firm that provides data and analytics on portfolios and plans to launch a suite of alternative model portfolios.
The details
Asset managers are increasingly packaging private equity, infrastructure, and private credit into familiar, strategy-based model portfolios to simplify access. For instance, Morgan Stanley recently rolled out nine model portfolios that feature 8% to 12% allocations to these private assets. Despite this packaging, 35% of advisors still express concern about a lack of transparency into the underlying holdings of these funds, which can complicate risk management for households.
Timeline
2022: Alternative investments outperformed traditional equities and bonds.
2025: 68% of advisors felt comfortable explaining private investments to their clients.
October 2026: Morgan Stanley rolled out nine new model portfolios containing private assets.
Money Landscape
The push to include private markets in standard portfolios follows the notable performance of alternative investments in 2022. This shift marks a departure from traditional stock-and-bond strategies as firms attempt to bring institutional-style diversification to individual household accounts.
If your advisor suggests adding private assets to your holdings, ask specifically about how the liquidity constraints might impact your ability to withdraw funds in an emergency. Discuss these complex products with a qualified financial professional to determine if they align with your specific risk tolerance.
The takeaway
The rise of private market options in model portfolios aims to simplify diversification, but these products often come with higher fees and lower liquidity than standard funds. If you hold these investments, review your account statements to ensure you understand the fee structure and the timeline for accessing your cash.
Further reading
For more on managing complex portfolio allocations, visit Financial Planning.
Source note: This article includes information reported by The Daily Upside.
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Would you choose to include complex private market investments in your personal retirement portfolio?
