Goldman Sachs is making it easier for independent advisors to help unlock much-needed liquidity from their clients’ alternative investment holdings.
On Monday, Goldman Sachs Advisor Solutions introduced a new lending feature aimed at providing eligible clients of RIAs greater liquidity by letting them borrow against specific types of alternative investment positions within their portfolios.
GSAS has launched this lending feature to address the increasing demands of sophisticated investors. According to GSAS, RIAs plan to increase their alternative investment allocations by thirty-one and one-tenth percent over the next two years, making it the largest expected allocation increase among investment vehicles.
That includes private credit, which more than 60 percent of advisors at RIAs are planning to dial up their allocations to, according to a recent survey by wealth tech provider and alts platform Crystal Capital Partners.
That demand isn’t lost on Goldman, which shook up the leadership at its asset management arm’s private credit unit in December as part of an effort to double the size of the business.
"Providing independent advisors access to a broad menu of institutional-grade solutions truly differentiates the end client experience," Jeremy Eisenstein, managing director at GSAS, said in a statement.
The new solution has been developed in collaboration with Goldman Sachs Bank USA and aligns with the firm's One GS RIA Strategy, led by Adam Siegler and announced last September.
Traditionally, custodians have provided loans against publicly traded securities, but the new feature enables advisors working with GSAS to offer their clients more flexibility by allowing borrowing against select alternative investments.
The new initiative is just the latest show of Goldman Sachs’s commitment to the evolving investment landscape. Just last month, several executives at the firm joined NewEdge Wealth CIO Cameron Dawson in a webinar that touched on the how-to’s of recommending alternative strategies in clients’ portfolios.
“The way you’re invested has to be far more focused and far more selective,” Dawson said. “The most important part in all of this is making sure that clients know what they own and why they own it.”
"Complex financial situations require solutions which empower RIAs with choice and greater flexibility in managing the assets and debits in their clients' portfolios,” Eisenstein said, highlighting the benefits of the firm’s “alternatives-based lending solution through our custodial platform.”
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