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In recent history, institutional investors have increased allocations to alternative assets in an effort to boost portfolio returns. The attention is now turning to individual investors. Significant partnerships, private platforms, and organizations have emerged to democratize access to alternative investments. In 2021, the US Department of Labor also took a position, suggesting that it might be prudent to include private equity in individual retirement accounts, such as in 401(k) and 403(b) plans. While institutional investors have decades of experience investing in alternative assets, the vast majority of individual investors do not. Consequently, relatively little is known about optimal alternative asset allocations for individual investors. This article presents historical risk and return characteristics from private investments including venture capital, private equity, private credit, and real estate, and constructs portfolios building on a traditional 60/40 (public equity/public debt) allocation, with varying levels of a private markets index, to examine portfolio risk and return trade-offs. Findings reveal that there are portfolio benefits to both returns and risk from adding a significant allocation to alternative investments and that wealth impacts can be sizable over time. [ABSTRACT FROM AUTHOR]

Using the WHO announcement on 11 March 2020 and the Federal Reserve Bank announcement on 9 April 2020 as two events that represent the shock and the stimulus, this study finds that COVID-19 caused a negative shock to the global stock markets, especially in emerging markets and for small firms. We find that the US stock market experienced positive abnormal returns from the Fed stimulus compared to other developed countries and emerging markets. We find that the positive abnormal returns from the stimulus were garnered by the US large firms instead of the small firms. [ABSTRACT FROM AUTHOR]