Alternative Assets for Retail: Risk, Liquidity, and the Public-to-Private Continuum

As public and private markets blur, top investors discuss the risks, the need for fiduciary duty, and why the “public markets-only portfolio” should be obsolete.

The shrinking number of public companies is pushing investors to seek diversification in the private markets. But as the line between public and private assets becomes increasingly blurred, do the potential benefits of alternative investments outweigh the inherent risks of lower liquidity?

CNBC’s 15th annual Delivering Alpha investor summit gathered industry titans—including Bill Ford (General Atlantic), Philippe Laffont (Coatue Management), Michael Arougheti (Ares Management), and Mary Erdoes (JPMorgan Asset & Wealth Management)—to address the critical questions surrounding the alts industry.

Opportunities: Public vs. Private Markets in the AI Era

The Influence of Public Tech Giants

Ford: The drivers of change in AI are the large public tech companies. You cannot make good investment decisions in the private market unless you are fully aware of what firms like Oracle, Google, and Microsoft are doing.

Laffont: We invest across the spectrum. While combining public and private investing has advantages, they require different skill sets. Public investing requires judging whether the future is “already priced in,” while private investing demands more patience and a longer horizon (5-7 years), allowing investors to ride out cycles.

The Broken IPO Market and Tokenization

Laffont: I believe the IPO market is “totally broken” and unfair, as retail investors struggle to access the growth realized before a company goes public. The fix, he argues, will come through competition: Tokenization of private assets essentially makes them public and tradable, paving the way for a future where maybe “all assets are going to be public and tradable.”

Ford: I’m more optimistic. While the private market has experienced an “exit recession” over the last three years, driven by regulatory factors and market trends, I believe the IPO market will see a comeback in 2026, assuming stability returns.

Democratizing Alts: Risk, Due Diligence, and Liquidity

The Fiduciary Duty of Access

Arougheti: Increasing retail access to investment products that aid wealth creation and retirement is a good thing, provided it is managed with a focus on fiduciary duty. Retail investors should have access to institutional-quality products, as long as they are “structured the right way and they’re well advised.”

Erdoes: Regulatory changes aim to allow alternatives into vehicles like 401(k) accounts so everyday investors can participate in the 99% of U.S. companies that are not public. Erdoes argues that there should be no such thing as a “public markets-only portfolio” if the risks are properly managed; the ideal portfolio should be viewed as a “public-to-private continuum.”

Structuring Out “Bad Behavior”

Arougheti: The innovation of semi-liquid structures (like interval funds) allows investors to own private assets through a full cycle, capturing value creation without the pressure to sell during a downturn. Traditionally, retail investors were “trained for generations” to be liquid, causing them to sell what they can, not what they should, during volatility. These new structures help “structuring out the bad behavior” by offering controlled liquidity.

Erdoes: The sophistication of evergreen funds and interval funds allows investors to hold assets indefinitely, avoiding the necessity of a forced mark-to-market sale due to a fund’s maturity date. When implemented with the right “bite size,” these provide a tremendous opportunity for retail investors globally.