IMF concerned about alternatives

Alternative assets are so hot right now. And the IMF is worried. Whether it be venture capital, private equity, real estate, hedge funds, art, jewellery, infrastructure, classic cars or music royalties, pension funds have never been more exposed to this cohort of financial assets. Very low rates have prompted institutional investors like insurance companies, pension funds, and asset managers to reach for yield and take on riskier and less liquid securities to generate targeted returns. For example, pension funds have increased their exposure to alternative asset classes like private equity and real estate. What are the possible consequences? Similarities in portfolios of investment funds could amplify a market sell-off, and illiquid investments by pension funds could constrain their traditional stabilising role in markets.