401(k) plan advisors warm up to alts — with one exception

Core Insights - The review of ERISA fiduciary guidelines by President Trump has led to increased interest in alternative investments among 401(k) plan advisors [1] - A significant portion of defined contribution plan advisors are likely to recommend alternative investments, with 10% already doing so [1][2] Group 1: Advisor Interest in Alternative Investments - Approximately 25% of defined contribution plan advisors are likely to recommend alternative investments in workplace plans [1] - Private equity, private real estate, and private credit are the most favored asset classes, with over one-third of advisors either recommending them or showing strong interest [2] - Hedge funds and venture capital have moderate support, while private infrastructure and secondaries have lower enthusiasm, with only about 25% of advisors expressing interest [2] Group 2: Retail vs. Institutional Interest - Interest in alternative investments is rising among retail investors, similar to trends observed in the defined contribution plan space [3] - Advisors have historically used alternatives for high-net-worth and institutional clients, but these options are becoming relevant for employees across various income levels [3] Group 3: Cryptocurrency Interest Discrepancy - Only 2% of surveyed advisors are actively recommending cryptocurrency, with an additional 17% interested in future recommendations [4] - In contrast, 9% of plan participants are already investing in cryptocurrency, and 25% express strong interest, indicating a 74% higher interest in crypto among participants compared to advisors [5] - An investment management consultant suggests that both private equity and cryptocurrency should have limited allocations in portfolios, recommending 5% for older participants and 15% for younger ones [6]