Alternatives are Eating Fixed Income's Cake, Equities are Eating Everything

There's a lot of noise around the growth of alternatives for asset managers. Are they taking over the world, or have they collapsed following the change in central bank interest rate regime in 2022? 

It's sometimes hard to put the noise into context. 

Here are two charts to help put alternatives in their place with respect to total global AuM.

Global AuM Allocation by Asset Class

Allocation to alternatives has declined since 2022, yet the absolute level of alternatives has continued to increase. Equity AuM have simply grown faster. 

Global AuM by Alternative Asset Class

Among the alternatives, growth in real estate and real assets (infrastructure, etc.) has slowed, hedge fund allocation has stalled, and private credit continues its ascent.