The forces driving the increased demand for alternatives

Low interest rates, pension freedoms and less risky structures are some of the reasons driving the rise of alternatives in closed-ended funds according to Tim Mitchell, head of investment trust sales at J.P. Morgan Asset Management

Demand for income has been driving significant innovation in the UK investment companies sector in less traditional areas of the market, such as equities and bonds. Instead, much of the innovation has been driven by greater engagement with alternative asset classes. Investment companies (or closed-ended funds) lend themselves particularly well to alternative assets because, unlike funds, they are corporate bodies and have much greater flexibility in terms of what they can invest in and the manner in which they are structured.   One common characteristic that unites many new closed-...