New Alternatives, Built with TDAM expertise:
Go beyond stocks and bonds by gaining exposure to alternative investment strategies
Major institutional investors such as pension plans have steadily increased their allocation to alternative assets as they have realized the benefits of diversifying away from fixed income and equity investments. Now, with the ability of individual investors to allocate to alternatives through pooled funds, they can receive the benefits of this institutional approach.
Alternatives are investments in assets other than bonds, stocks or cash.
What are Alternative Investments?
Main Types of Alternatives
- Public Market Alternatives
- Foreign Exchange Strategies
- Options Strategies
- Hybrids
- Commodities
- Private Market Alternatives
- Real Estate
- Infrastructure
- Mortgages
The power of adding alternatives to a portfolio
Conventional mutual funds are usually invested in public equities and bonds which can offer diversification across market sectors; however, they have a high degree of correlation to traditional financial markets. This means that, in times of heightened volatility, we often see a corresponding response to varying degrees depending on the asset allocation within the mutual fund.
Beyond providing exposure to broader asset classes, Liquid Alternatives are also able to engage in certain investment strategies – including short-selling, borrowing, and use of derivatives. These strategies may be utilized to seek to enhance returns, reduce losses from market declines, reduce overall portfolio volatility, or attain a market neutral position.
The combination of diversification, downside protection, inflation protection and steady income make alternatives a strong addition to traditional balanced portfolios.
Evolving the Traditional Balanced Portfolio – Part 4
Alternatives provide a strong addition as part of a traditional balanced portfolios
The TDAM Advantage
With over 30 years of experience in alternative investment solutions, TD Asset Management Inc. (TDAM) has built a strong reputation in the alternatives space and has a proven track record of innovation in this ever-changing investment environment. Our alternative investment strategies have been refined over decades, with a focus on robust portfolio management and diversification. The Alternatives team works closely with the Fixed Income and Public Equities teams as part of our collaborative approach to our investments that capitalizes on the full breadth of expertise of our organization. The increased market volatility experienced in recent years continues to demonstrate the key role that alternative investments can play in a diversified portfolio.
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TD Alternative Commodities Pool
The TD Alternative Commodities Pool offers a more diversified exposure to commodities than single commodity funds such as gold or silver. This can be a great complement for balanced portfolios, featuring an innovative approach that seeks to achieve capital appreciation with low correlation to equity and fixed income markets, which can improve diversification when added to investment portfolios.
TD Alternative Risk Focused Pool
TD Alternative Risk Focused Pool is a multi-asset solution combining alternative and traditional investment strategies, and is designed to outperform its benchmark across market conditions.