A recent survey by Hamilton Lane reveals that over 90 percent of financial advisors allocate client capital to private markets, with nearly all planning to continue or increase these allocations in the coming year. More than half of those surveyed intend to allocate 10 percent or more of their clients' portfolios to private markets. FinancialPlanning.com reports that this reflects a strong industry trend among non-institutional investors.

Advisors cite performance and diversification as the driving force for the increased interest in private markets. As reported by FinancialPlanning.com, the survey indicates that 70 percent of advisors plan to boost client allocations to this asset class compared to 2023.

Despite this increase, many clients lack knowledge about private markets, with 50 percent of advisors rating their clients' understanding as beginner level. Only 4 percent of advisors consider their clients well-versed in the asset class. While 97 percent of advisors report having advanced or intermediate knowledge of private markets, they acknowledge a gap in their clients' education.

Steve Brennan, Head of Private Wealth Solutions at Hamilton Lane, emphasizes the need for more education to sustain and grow interest in private markets. He notes that a foundational understanding can affirm initial interest and enhance long-term investment appetites.

Advisors identified education, thought leadership, and events as some of the top tools in improving their clients' knowledge of private markets. As clients become more familiar with this asset class, advisors expect to see increased allocations to private markets in their portfolios.

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