Alternative Investment Opportunities Through a Slowing Economy

FIGURE 10 : Inc reasing Share of Annual Secondary Transac tion Volume Repr esented by GP-Led Transactions 0 20 40 60 80 100 120 140 2016 2017 2018 2019 2020 2021 2022 $ billion LP-Led Volume GP-Led Volume Source: Jefferies & Co. as of December 31, 2022 Activemanagement to seek out quality and value in volatile times Global equities, as measured by the MSCI World Index, generated annualized returns of approximately15% from2017 to 2021, with three of those five calendar years having total returns above 20%. 11 Given this attractive return from simple beta exposure, passive investment strategies have come to dominate the equity investing landscape. With the financial stresses and uncertaintywe have seen over the past 18months, the ability to generate alpha rather than relying solelyon beta has become a key consideration for investors in today’s environment. However, this is dependent uponmanager selection, and if high levelsof correlation return to equitymarkets it becomes more difficult to outperforma simple beta exposure in the long term. 11 Bloomberg, as of May 2023, historical data through December 31, 2021 OPPORTUNITIES | WEALTH OUTLOOK 2023 | MID-YEAR EDITION │ ALTERNATIVE INVESTMENTS | 17