Fidelity Investments is jumping into liquid alternatives, products that offer regular investors access to hedge-fund like strategies and are raking in billions of dollars amid rising interest rates and increased market volatility.
The money-manager has started a new unit, Fidelity Diversifying Solutions, which is hiring staff and rolling out offerings, according to a statement from the entity’s president, Vadim Zlotnikov. The segment also filed to register two funds at the end of last year, Fidelity Global Macro Opportunities and Fidelity Risk Parity.
“We’ve heard from our clients that they are looking to diversify,” beyond traditional stocks and bonds, Zlotnikov said in the statement. “We’ve explored these areas in the past, but today and going forward we have a strategic commitment to building a world-class alternative franchise.”
Liquid alternatives are registered mutual funds that took off following the financial crisis only to fall from favor as the Federal Reserve’s easy money policies buoyed stocks and other plain-vanilla investments. The sector staged a comeback during the pandemic, adding $29 billion last year and marking the first time since 2015 that inflows exceeded redemptions, according to Morningstar Inc.
“There has been significant renewed interest in liquid alts, both from retail and institutional investors,” said Erol Alitovski, a Morningstar strategist, adding that funds attracted an additional $8.2 billion in the first two months of this year. “It’s a different sort of asset class and strategy that can produce returns in a volatile environment.”
In addition to mutual funds, Fidelity Diversifying Solutions plans to offer strategies through traditional limited partnership structures that provide less liquidity to investors, Zlotnikov said.
The new unit is part of Fidelity’s push to expand its alternative investment capabilities. The Boston-based asset manager already offers some strategies for investing in distressed debt, real-estate debt, private equity and Bitcoin.
Canadian stocks are on a roll in 2025 as the country prepares to name a new Prime Minister.
Two C-level leaders reveal the new time-saving tools they've implemented and what advisors are doing with their newly freed-up hours.
The RIA led by Merrill Lynch veteran John Thiel is helping its advisors take part in the growing trend toward fee-based annuities.
Driven by robust transaction activity amid market turbulence and increased focus on billion-dollar plus targets, Echelon Partners expects another all-time high in 2025.
The looming threat of federal funding cuts to state and local governments has lawmakers weighing a levy that was phased out in 1981.
RIAs face rising regulatory pressure in 2025. Forward-looking firms are responding with embedded technology, not more paperwork.
As inheritances are set to reshape client portfolios and next-gen heirs demand digital-first experiences, firms are retooling their wealth tech stacks and succession models in real time.
