Alternative Investments:
Combining
Choice and Expertise


Legg Mason’s depth of experience extends beyond
traditional investments to alternative solutions, covering
a wide range of asset classes, structures and strategies.

Committed to Being Your Partner in this Growing Asset Class

Alternative investments have risk and return characteristics different from traditional stocks and bonds – making them efficient levers for investors targeting investment outcomes such as enhancing returns, managing risk or diversifying exposures. Given the highly specialized nature of these strategies, it’s important to partner with an established manager with the appropriate experience, resources and vision.

* Source: Legg Mason, as of September 30, 2018, in US Dollar terms
** Experience based on founding years of investment affiliates.

Recognize the Opportunity

The expanding alternatives investment universe and an informed approach to strategy selection offer flexibility. 

Alternative asset classes, structures and strategies enable investors to address specific financial goals through investments that may be nuanced and relatively hard to access by individual investors. 
Real Assets
Real estate, infrastructure, commodities and MLPs may serve as diversifiers, income plays and potential inflation hedges.
Private Investments
Traditional asset classes in non-traditional structures, such as private equity and credit, which may be available only to certain investors.
Alternative Strategies
Dynamic integration of an expanded toolkit of financial instruments and investment techniques targeting a variety of outcomes.

Explore the Outcomes

Alternatives may improve the risk-return profile of a traditional portfolio – they provide access to unique investment opportunities and can help manage the overall risk/return profile of a portfolio.

Most investors are familiar with the concept of diversifying within and across the three traditional asset classes — stocks, bonds and cash.

Today’s market environment, however, poses risks that may call for a higher degree of diversification, given elevated valuations, hard-to-predict political risks and the high-profile policy moves of central banks. That makes it imperative to consider how solutions with potentially lower correlations to traditional holdings can enable investors to target additional sources of returns, mitigate market volatility and focus on specific investor needs.

Annualized Returns and Standard Deviation for Alternative Investments Over the Long Term
Source: Bloomberg, as of September 30, 2018. Historical return and risk asset class observations are based on quarterly data from January 1 1999 to September 30 2018.
Past performance is not a guarantee of future results. Index returns do not reflect any fees, expenses or sales charges. Indexes are unmanaged and investors cannot invest directly in an index. Standard deviation measures the risk or volatility of an investment’s return over a particular time period; the greater the number, the greater the risk.
This information is provided for illustrative purposes only. Illustrated portfolios shown do not represent the performance of an actual investment. The results are rebalanced quarterly and assume reinvestment of ordinary income and distributions. The results do not reflect a deduction of fees, taxes, and other expenses, if any, which would reduce performance.
* Portfolio with Alternatives is represented by a mix of 47.5% S&P 500 Total Return Index, 27.5%  Bloomberg Barclays U.S Aggregate Bond Index (BbgBarc U.S Agg Bond), and 5% of each alternative index equally weighted - HFRI Fund Weighted Composite Index, NCREIF Property, Alerian MLP Index, Bloomberg Commodity Index, and MSCI World Infrastructure Sector Capped Index. 
** Traditional portfolio is represented by a 60-40 mix of S&P 500 Total Return Index and Bloomberg Barclays U.S. Aggregate Bond Index.
Diversification does not guarantee a profit or protect against a loss.
Alternative Strategies Can Expand a Traditional Portfolio's Efficient Frontier
Illustration of adding alternative investments to a traditional allocation (January 1990 – September 2018)
Source: Bloomberg, as of September 30, 2018. Quarterly returns from 1Q 1999 - 3Q 2018. Stocks, Bonds and Alternative weights are determined by funding a 25% Alternatives weight equally from Stocks and Bonds. Stocks are represented by S&P 500 Total Return Index. Bonds are represented by Bloomberg Barclays U.S. Aggregate Bond Index. Alternatives represent an equal weighted across 5 categories: NCREIF Property Index, Alerian MLP Index, Bloomberg Commodity Index, MSCI World Infrastructure Sector Capped Index, HFRI Fund Weighted Composite Index. Varying allocation percentages and/or investment time periods would produce different results.
Past performance is not a guarantee of future results. Index returns do not reflect any fees, expenses or sales charges. Indexes are unmanaged and investors cannot invest directly in an index. 
This information is provided for illustrative purposes only. Illustrated portfolios shown do not represent the performance of an actual investment. The efficient frontier represents the best expected combination mix of securities under consideration into a portfolio that produces the maximum expected return for a given level of risk. The efficient frontier concept is for illustrative purposes only and not an investment recommendation. Standard deviation measures the risk or volatility of an investment’s return over a particular time period; the greater the number, the greater the risk.
Diversification does not guarantee a profit or protect against a loss.
Can help manage risk during difficult market environments
Source: Bloomberg, as of November 30, 2018. Drawdown illustration depicts losses from prior highs. Drawdown observations are based on monthly data from January 1998 to November 2018.
Past performance is not a guarantee of future results. Index returns do not reflect any fees, expenses or sales charges. Indexes are unmanaged and investors cannot invest directly in an index. 
This information is provided for illustrative purposes only. Illustrated portfolios shown do not represent the performance of an actual investment. The results are rebalanced quarterly and assume reinvestment of ordinary income and distributions. The results do not reflect a deduction of fees, taxes, and other expenses, if any, which would reduce performance. A traditional portfolio is represented by 60-40 mix of S&P 500 Total Return Index and Bloomberg Barclays U.S. Aggregate Bond Index (BbgBarc U.S.Agg).
Diversification does not guarantee a profit or protect against a loss.
Alternatives May Offer Lower Correlations and Diversification Benefits
Source: Bloomberg, as of September 30, 2018. Correlation observations are based on quarterly data from Q1 1999 to Q3 2018. Correlation is a statistical measure of the relationship between two sets of data. When asset prices move together, they are described as positively correlated; when they move opposite to each other, the correlation is described as negative or inverse. If price movements have no relationship to each other, they are described as uncorrelated. This information is provided for illustrative purposes only.
Past performance is not a guarantee of future results. Index returns do not reflect any fees, expenses or sales charges. Indexes are unmanaged and investors cannot invest directly in an index.  
Diversification does not guarantee a profit or protect against a loss.

Established Expertise

We’re proud to have been recognised by the region’s private banks as Asian Private Banker’s Best Service Provider – Hedge Fund Platform for 2019.

We’ll continually leverage our extensive platform housing the capabilities of our investment managers to always deliver best-in-breed alternative solutions for you and your clients. 

Source: Asian Private Banker, Asset Management Awards for Excellence 2019, based on the four criteria of product performance, business performance, service competency, branding and marketing up to 30 September 2018.

Solutions

Legg Mason's alternatives platform has an expansive footprint and investment expertise to deliver differentiated  alternative solutions. Our investment affiliates are committed to offering innovative solutions across multiple asset classes and investment outcomes. 

Real Assets

Listed Infrastructure
Real Estate

Clarion Partners

  • Gables Multi Family Strategy2
  • Lion Industrial Strategy2
  • Multi Strategy Real Estate Strategy2

 

Private Investments

Private Debt Investments

EnTrustPermal

  • Aviation Financing Strategy2
  • Maritime Private Credit Strategy2
  • Special Opportunities Strategy2

 

Alternative Strategies

Equity
  • Legg Mason Martin Currie Asia Long-Term Unconstrained Fund1
  • Legg Mason Martin Currie European Absolute Alpha Fund1
  • Legg Mason Martin Currie Japan Absolute Alpha Fund1
Fixed Income
  • Legg Mason Brandywine Global Enhanced Absolute Return Fund1
  • Legg Mason Western Asset Macro Opportunities Bond Fund1
  • Legg Mason Western Asset Structured Opportunities Fund1
Multi-Strategy
  • EnTrustPermal Alternative Income Strategy1
1 The Fund is not authorised nor recognised by the Monetary Authority of Singapore in Singapore and is not available to retail investors in Singapore.
2 Proposed strategy name and subject to change. The strategy discussed herein is currently in the conceptual phase.

Engage

Navigate together with Legg Mason the spectrum of alternative investments.

Important Information

Source: Legg Mason. This document, provided by Legg Mason Asset Management Singapore Pte. Limited (“Legg Mason”) (Registration Number (UEN): 200007942R), is for information only and does not constitute an offer or solicitation to buy or sell any units in any fund.
Legg Mason Martin Currie Asia Long-Term Unconstrained Fund, Legg Mason Martin Currie European Absolute Alpha Fund, Legg Mason Martin Currie Japan Absolute Alpha Fund, Legg Mason Brandywine Global Enhanced Absolute Return Fund, Legg Mason Western Asset Macro Opportunities Bond Fund, Legg Mason Western Asset Structured Opportunities Fund and EnTrustPermal Alternative Income Strategy are not authorised nor recognised by the Monetary Authority of Singapore in Singapore, thus, it is not available to retail investors in Singapore. 
The Legg Mason Rare Infrastructure Value Fund  may invest in certain types of derivatives for investment and/ or efficient portfolio management purposes. Please refer to the prospectus for more information.
Distribution of this document may be restricted in certain jurisdictions. Any persons coming into possession of this document should seek advice for details of, and observe such restrictions (if any). This document does not constitute the distribution of any information or the making of any offer or solicitation by anyone in any jurisdiction in which such distribution or offer is not authorized or to any person to whom it is unlawful to distribute such a document or make such an offer or solicitation. 
Neither Legg Mason nor any officer or employee of Legg Mason accepts any liability whatsoever for any loss arising from any use of this document or its contents. The information in this document is proprietary and may not be used other than by the intended user. This document may not be reproduced, distributed or published without prior written permission from Legg Mason.
The mention of any individual securities / funds should neither constitute nor be construed as a recommendation to purchase or sell securities, and the information provided regarding such individual securities / funds is not a sufficient basis upon which to make an investment decision. Portfolio allocations, holdings and characteristics are subject to change at any time. Although information has been obtained from sources that Legg Mason believes to be reliable, no guarantee can be given as to its accuracy and such information may be incomplete or condensed and may be subject to change at any time without notice. Legg Mason, its affiliates, officers or directors, may have an interest in the acquisition or disposal of the securities mentioned herein.
The views expressed are opinions of the portfolio managers as of the date of this document and are subject to change based on market and other conditions and may differ from other portfolio managers or of the firm as a whole. These opinions are not intended to be a forecast of future events, a guarantee of future results or investment advice.  
This advertisement or publication has not been reviewed by the Monetary Authority of Singapore.