Over the months, starting with the pandemic, then with the war in Ukraine, the titles’ volatility and tax fluctuations have been moving in an unplanned way creating stress on portfolios that were structured by bank institutions.
To answer such an uncertain contect, alternative investments became more appealing, being a valid option in moments of suffering and potentially being a good source of income in the long run, the perfect balance between risk and income.
For this reason, Run Capital Partners has made out of the structuring of alternative funds of Luxembourg right one of its main business lines.
What is an alternative investment fund?
An alternative investment fund is a type of fund which invests in non-traditional activities, such as titles which are not part of the stock market, real estate funds, prime materia, complex financial derivatives and other unconventional financial tools.
Differently from traditional funds, which are mainly focused on stocks and bonds, the alternative funds can invest in a wide range of activities and can use complex investment strategies, such as financial laws.
Generally, they are planned to provide an investment opportunity that is diversified and well positioned, aiming to increase the income potential and reduce the total risk for portfolio investors.
Why choose investment funds?
Choosing an alternative investment can be beneficial in different moments over the financial market, one of these is the current time we are in. Therefore, projects which are only tied to market fluctuations seem to be the solution to significant losses in the market, instability and uncertainty.
Successful alternative investment funds
Let’s try to make room for some examples of alternative funds that unite successful entrepreneurial projects and financial innovation.
Several are the examples of alternative investment funds on the Italian market at the moment:
Run Properties in a real estate fund born with the goal to acquire properties in residential neighborhoods with high potential of re-evaluation. The idea was born from a commercial partnership with an important player of such field based both in Europe and the USA. Such collaboration makes the fund the right conjunction between rapidity and competence allowing it to take advantage of the hidden market opportunities.
Innovating is a requalifying project of an area which is underused. The fund aims to transform a low potential space creating new commercial, residential and green hubs. The technology innovation, from where it takes the name, is the final reason why the fund tries to host several local startups, increasing the potential synergies among them.
Why managing one’s wealth with an alternative fund?
The alternative funds can be used for family wealth as well. In Italy, around 76% of existing companies are PMI, often family-lead. These families’ wealth has amplified over time, but the management is often a little attentive and suitable for generational passage, which causes issues already between the first and second generation.
The alternative funds therefore become a working tool to solve such issues thanks to experts’ support and correct financial management. The fund prepares the family to lead a correct and linear transition without moving decisional power or participation quotas.
Conclusions
These are only some of the multiple uses of alternative funds. Run Capital Partners has chosen alternative funds under Luxembourg law as a solution to a different number of requests coming from people and companies. Luxembourg stays the best european state for this thanks to a clear and ever-evolving normative.
