LGT Crestone launches investment ‘alternative to traditional alternatives’

LGT Crestone has announced it is bringing a new investment vehicle to the market, developed in collaboration with family office PG3 AG and alternatives specialist Longreach Alternatives Ltd.

The PG3 Longreach Alternative Strategies Fund is a “custom-designed” investment option that provides investors with access to traditionally unattainable asset classes alongside a low correlation to both conventional and private market investments.

“We are delighted to offer our clients a very distinctive investment opportunity that strongly aligns to our commitment to pioneering institutional-calibre solutions for high-net-worth individuals and families,” Martin Randall, Head of Private Markets at LGT Crestone, said.

“Diversification is fundamental to our investment philosophy. Alternative investments like private markets and unlisted real assets have certainly helped diversify portfolios in recent years, however, they often share similar market-related and/or economic sensitivities with traditional assets. Private equity is still equity after all, so when you strip out differences in valuation approaches, the underlying risk factors are the same and should be considered as such when building well diversified portfolios.

“What sets this opportunity apart is its ability to genuinely diversify portfolios through numerous idiosyncratic return streams that have been shown to be uncorrelated to both traditional and alternative assets. In this sense, it represents an ‘alternative’ to traditional alternatives.”

The fund leverages the expertise of several managers to provide a diversified multi-strategy aligned to PG3’s key investment areas, including Insurance Finance, Royalty Finance, and Litigation Finance.

“Partners Group has had a long-standing relationship with LGT Crestone, however this custom-built solution is the first time we have made these three combined strategies from our own family office, PG3, available in way that is a true reflection of the founders’ portfolio, taking the same unconstrained relative value approach across the three strategies,” Urs Wietlisbach, co-founder of Partners Group, said.

“These three strategies have provided a consistent source of returns to our family office during significant market downturns, such as throughout COVID. Our approach ensures flexibility to effectively navigate evolving market conditions.”

LGT Crestone also said close to 20 per cent of its $30 billion in assets under management have been allocated to alternatives.

“Longreach’s longstanding relationship with LGT Crestone speaks to their position as a leader in private markets, making them an ideal partner for delivering such an innovative alternative investment solution. We’re confident that this collaboration will empower high-net-wealth investors with access to a truly unique investment opportunity,” Sam Edwards, Managing Director at Longreach Alternatives, said.