The Rise of Alternatives

Juliane Begenau, Pauline Liang, Emil Siriwardane

Research

67 Pages

Juliane Begenau, Pauline Liang, and Emil Siriwardane examine why U.S. public pension funds have shifted heavily into alternatives, showing that consultant influence and return expectations—not risk appetite—primarily drove the move.

Date Published: June 10, 2025

Key Takeaways

Belief driven shift: Rising perceived alpha in alternatives explains reallocation away from public equities.
Consultant influence: Advisory assumptions and models materially affect long run policy portfolios.
Peer and history effects: Nearby peers and 1990s equity experiences helped entrench alternative allocations.
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