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JULY 2019
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Business News
Business
N E W S A N D V I E W S I N T H E B U S I N E S S W O R L D
P
rivate capital structuring is
experiencing an uptick, and
Guernsey is well placed to
capitalise on the trend.
The increase is due to a greater
focus on diversification amongst
private investors, combined
with an industry that is
bringing private assets such
as private equity and real
estate increasingly into the
mainstream.
In 2017 global personal
financial wealth grew by 12
per cent to break through
the $200 trillion barrier (Boston
Consulting Group, Global Wealth
Report 2018). As private investors
and family offices have grappled
with volatile equity and bond markets,
a rising number of fund managers have
in recent years looked to bring specialist
private asset investment opportunities –
traditionally the domain of institutional
investors – to the wholesale market.
Craig explains: “Market volatility will
likely be lucrative for some, but for private
investors looking for somewhere else to
put their money besides the bank, private
assets can be a key part of their portfolio's
construction.
“As time has gone on, private investors
have increasingly looked for exposure to
investments which may traditionally have
been out of reach for most. Institutional
investors and pension funds have been
in this space for some time, but wealth
managers eager to increase their own
remuneration have paved the way for
their clients to gain access, too."
Although this sort of investment
diversification poses some potential
challenges for private investors, Craig
believes a balanced approach can
prove fruitful, and that Guernsey, given
its experience across the private wealth
and alternative fund sectors, is in a good
position to support this activity.
“These assets won’t be for everyone –
by their nature they may be illiquid and
investors may have to wait a significant
period if they can divest. That said, a listed
vehicle investing in these types of assets
can provide for the investment exposure
investors want, coupled with liquidity should
DIVERSIFY TO
ACCUMULATE
CRAIG CORDLE , PARTNER AT OGIER , EXPLAINS
WHY GUERNSEY IS WELL PLACED TO CAPTURE
THE UPTICK IN PR IVATE CAPITAL STRUCTUR ING
they want to sell. One has to remember
that for ultra-high-net-worth investors,
risk-adjusted returns are often an
added bonus – their key focus is
capital preservation, which is
brought into sharp focus with
the volatility of equity and
bond markets. It's easy to see
why investors are increasingly
growing their foothold in this
area.
“Over many decades,
Guernsey has built up
considerable experience
in enabling private investors
to implement their wealth
strategies and in structuring
investment vehicles. The rise of
private capital in the institutional
space, including co-investment,
club deals and family office activity,
is a market that Guernsey is therefore
perfectly positioned to support.”
Craig is an asset
management
lawyer based in
Guernsey. He advises
on all aspects of
the structuring,
restructuring,
merger, establishment and operation of
investment funds and other collective
investment arrangements, including
the marketing of investment vehicles in
numerous jurisdictions. Client feedback
in
Legal 500 UK 2019
praises his “wealth
of expertise and great intellectual
capacity”. In 2019 he was recognised as a
rising star by
IFLR 1000
.