Getting Started in Alternative Investments

Matthew Dearth, PhD is Adjunct Faculty of Finance at Singapore Management University, where he teaches graduate-level finance courses on sustainable investing and alternative investments. He is Managing Director at Silvercrest Asset Management, a leading independent advisory and financial services firm created to provide traditional and alternative asset management and focused family office services to wealthy families and select institutional investors. Swee Yong Ku is a founder of International Property Advisor, a licenced real estate consultancy. He was an adjunct faculty at the Singapore Management University’s Lee Kong Chian School of Business and at the National University of Singapore’s Department of Real Estate. His recent research interests are focused on the impact that technology has on the built environment and consequently how real estate investments and finance may be affected.

• Acknowledgments ixAbout the Authors xiiiIntroduction 1Chapter 1 Introduction to Alternatives 51.1 What Are Alternatives? 61.2 Investing in Alternatives 81.3 Diversification 341.4 Regulation 361.5 Summary 41Notes 42Chapter 2 Traditional Alternatives 452.1 Venture Capital 462.2 Private Equity 552.3 Hedge Funds 662.4 Infrastructure 792.5 Land and Commodities 822.6 Funds of Funds 882.7 Summary 89Notes 90Chapter 3 Real Estate 933.1 The Global Real Estate Market 933.2 Structure of This Chapter 943.3 Characteristics of Real Estate 953.4 Classifying Real Estate Segments 963.5 Real Estate Valuation 1013.6 Due Diligence 1053.7 The Four Quadrants of Real Estate Investment 1063.8 Future Trends in Real Estate 113Chapter 4 Modern Alternatives 1194.1 Private Credit and Alternative Finance 1194.2 Insurance- Related Finance 1284.3 Impact Investing 1324.4 Blockchain, Coins, and Non- Fungible Tokens 1364.5 Real Estate Tokenization and the Metaverse 1434.6 Collectibles 1514.7 Other Opportunities 159Notes 163Chapter 5 Building Portfolios 1675.1 The Portfolio Management Process 1675.2 Traditional Portfolios 1705.3 Mean- Variance Optimization 1715.4 Adding Alternative Investments 1735.5 The Endowment Model 1745.6 Risk Budgets, Risk Parity 1745.7 Summary 176Notes 177Appendix Real Estate Investments 179A.1 The Characteristics of Real Estate as an Asset Class 179A.2 Classifying Real Estate Segments 183A.3 Analyzing the Real Estate Segments 186A.4 Real Estate Valuation 214A.5 Due Diligence 228A.6 The Four Quadrants of Real Estate Investment 229Notes 272About the Website 273Index 275