Starting With the Basics, Aiming for the Extraordinary
When you invest with Blackstone, however, you get access to highly competitive products as well as a carefully tailored investor experience. This means access to scaled, institutional-quality investment funds and significant resources to deliver education, insights and investor services support, all wrapped in the trust of the Blackstone brand.
In the third quarter, the firm’s flagship strategies added to their record of outperformance versus public-benchmark counterparts, demonstrating again why nearly all of Blackstone’s major businesses are leaders in their respective asset classes.
Clients responded by entrusting the firm with more of their capital to manage, as Blackstone reported net inflows despite rising uncertainty across both public and private markets. We see this as earned trust and affirmation of Blackstone’s ability to deliver quality and innovation alongside unwavering all-weather service for our clients.
The past couple of years have caused many investors to rethink their relationship with public markets. Last year, the traditional 60/40 stock and bond allocation model1 suffered its worst performance in years, and while this year’s experience should end up less painful, the environment has clearly shifted.2 Given the fluctuations in stock and bond prices over that time, it would be hard to fault investors for questioning the mix of assets they own.
There is wider recognition today that stock and bond markets’ pricing methods are not the only way to value all assets at all times. Exaggerated short-term price moves in public markets can become a tool in the investment manager’s arsenal, something investors can use to capitalize on temporary mispricing of attractive assets. We believe a manager who is not constrained by investment flows or timing considerations can act decisively. Such a manager can also simply do nothing if circumstances warrant a wait-and-see approach.
Similarly, across the marketplace today, we believe there is a growing awareness that liquidity is not the same as risk. Proactive management of cash-flow needs can open a world of opportunity in illiquid and semiliquid strategies. Especially in times like these, we believe that Blackstone’s focus on long-term investing helps the firm identify mispriced assets and capitalize upon disruption.
Education remains critical to Blackstone’s commitment to helping advisors and end investors build expertise in private investments.
Even more important in our opinion is how Blackstone partners with its clients. Just as Blackstone provides more than capital to the companies in its portfolios, it also strives to go above and beyond product and performance for individual investors. Education, for example, remains critical to Blackstone’s commitment to helping advisors and end investors build expertise in private investments, as well as confidence in how financial professionals select strategies and manage their clients’ portfolios.
This is why Blackstone Private Wealth Solutions recently launched its on-demand Continuing Education Program, which allows financial professionals in select regions to earn educational credits as they hear from Blackstone about a wide range of private investing topics. It is also at the core of our Essentials of Private Markets 101-level educational programming.
Some 12,000 financial advisors have participated over the last 12 years in Blackstone University, the firm’s flagship educational program for its private wealth partners,3 a program that also helps Blackstone get a pulse on what advisors and—by proxy—their clients are thinking.
A recent survey of Blackstone University participants turned up a “back to basics” message: The top priority for portfolios today, these participants say, is diversifying risk (42% of respondents). Over the next six months, more than half (58%) say they intend to urge clients to raise allocations to private markets, and 39% say they have already done so this year.
We believe in the basics. In fact, we think such fundamentals can only push us even harder in striving to deliver best product and the best client experience possible – turning a focus on the basics into the pursuit of the extraordinary.
Accessing Private Markets with Blackstone
We are grateful to you, our clients, for the trust you place in us to help you deliver for your own investors and clients. We invite you to reach out for a conversation on how Blackstone can serve your needs even better in the future.
Global Head, Private Wealth Solutions
Past performance does not predict future returns. There can be no assurance that any Blackstone fund or investment will achieve its objectives or avoid substantial losses.
1. As commonly used in the industry, the 60/40 Portfolio is allocated 60% to the S&P 500 Index and 40% to the Bloomberg US Aggregate Bond index.
2. The Trusted 60/40 Investing Strategy Just Had Its Worst Year in Generations, Eric Wallerstein, Wall Street Journal, October 19, 2023.
3. Source: Blackstone, as of June 30, 2023.
Important Disclosure Information
All information is as of September 30, 2023 (the “Reporting Date”), unless otherwise indicated and may change materially in the future. Capitalized terms used herein but not otherwise defined have the meanings set forth in the Offering Documents. No securities commission or similar regulatory authority in Canada has reviewed or in any way passed upon the merits of the investments described herein and any representation to the contrary is an offense.
This webpage (together with any related materials or links, the “Materials”) does not constitute an offer to sell, or a solicitation of an offer to buy, any security or instrument, or a solicitation of interest in any Blackstone vehicle, account or strategy. If any such offer is made, it will only be by means of an offering memorandum or prospectus, which would contain material information including certain risks of investing including, but not limited to, loss of all or a significant portion of the investment due to leveraging, short-selling, or other speculative practices, lack of liquidity and volatility of returns. Nothing herein constitutes investment advice or recommendations and should not be relied upon as a basis for making an investment decision. The foregoing information has not been provided in a fiduciary capacity under ERISA, and it is not intended to be, and should not be considered as, research or impartial investment advice. Nothing herein constitutes investment advice or recommendations and should not be relied upon as a basis for making an investment.
Blackstone Securities Partners L.P. (“BSP”) is a broker-dealer whose purpose is to distribute Blackstone managed or affiliated products. BSP provides services to its Blackstone affiliates, not to investors in its funds, strategies or other products. BSP does not make any recommendation regarding, and will not monitor, any investment. As such, when BSP presents an investment strategy or product to an investor, BSP does not collect the information necessary to determine—and BSP does not engage in a determination regarding—whether an investment in the strategy or product is in the best interests of, or is suitable for, the investor. You should exercise your own judgment and/or consult with a professional advisor to determine whether it is advisable for you to invest in any Blackstone strategy or product. Please note that BSP may not provide the kinds of financial services that you might expect from another financial intermediary, such as overseeing any brokerage or similar account. For financial advice relating to an investment in any Blackstone strategy or product, contact your own professional advisor.
Blackstone Proprietary Data. Certain information and data provided herein is based on Blackstone proprietary knowledge and data. Portfolio companies may provide proprietary market data to Blackstone, including about local market supply and demand conditions, current market rents and operating expenses, capital expenditures, and valuations for multiple assets. Such proprietary market data is used by Blackstone to evaluate market trends as well as to underwrite potential and existing investments. While Blackstone currently believes that such information is reliable for purposes used herein, it is subject to change, and reflects Blackstone’s opinion as to whether the amount, nature and quality of the data is sufficient for the applicable conclusion, and no representations are made as to the accuracy or completeness thereof.
Forward-Looking Statements. Certain information contained in the Materials constitutes “forward-looking statements,” which can be identified by the use of forward-looking terminology or the negatives thereof. These may include financial estimates and their underlying assumptions, statements about plans, objectives and expectations with respect to future operations, and statements regarding future performance. Such forward-looking statements are inherently uncertain and there are or may be important factors that could cause actual outcomes or results to differ materially from those indicated in such statements. Blackstone believes these factors include but are not limited to those described under the section entitled “Risk Factors” in the Annual Report on Form 10-K for the most recent fiscal year ended December 31, of that year, and any such updated factors included in their respective periodic filings with the Securities and Exchange Commission, which are accessible on the SEC’s website at www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in the materials and in the filings. Blackstone undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.
Highly Competitive Market for Investment Opportunities. The activity of identifying, completing and realizing attractive investments is highly competitive, and involves a high degree of uncertainty. There can be no assurance that a Fund will be able to locate, consummate and exit investments that satisfy its objectives or realize upon their values or that a Fund will be able to fully invest its committed capital. There is no guarantee that investment opportunities will be allocated to a Fund and/or that the activities of Blackstone’s other funds will not adversely affect the interests of such Fund.
No Assurance of Investment Return. Prospective investors should be aware that an investment in a Fund is speculative and involves a high degree of risk. There can be no assurance that a Fund will achieve comparable results, implement its investment strategy, achieve its objectives or avoid substantial losses or that any expected returns will be met or that the returns will be commensurate with the risks of investing in the type of transactions described herein. The portfolio companies in which a Fund may invest (directly or indirectly) are speculative investments and will be subject to significant business and financial risks). A Fund’s performance may be volatile. An investment should only be considered by sophisticated investors who can afford to lose all or a substantial amount of their investment. A Fund’s fees and expenses may offset or exceed its profits.
Opinions. Opinions expressed reflect the current opinions of Blackstone as of the date appearing in the Materials only and are based on Blackstone’s opinions of the current market environment, which is subject to change. Certain information contained in the Materials discusses general market activity, industry or sector trends, or other broad-based economic, market or political conditions and should not be construed as research or investment advice.
Recent Market Events Risk. Local, regional, or global events such as war (e.g., Russia/Ukraine), acts of terrorism, public health issues like pandemics or epidemics (e.g., COVID-19), recessions, or other economic, political and global macro factors and events could lead to a substantial economic downturn or recession in the U.S. and global economies and have a significant impact on a fund and its investments. The recovery from such downturns is uncertain and may last for an extended period of time or result in significant volatility, and many of the risks discussed herein associated with an investment in a fund may be increased.
Third-Party Information. Certain information contained in the Materials has been obtained from sources outside Blackstone, which in certain cases have not been updated through the date hereof. While such information is believed to be reliable for purposes used herein, no representations are made as to the accuracy or completeness thereof and none of Blackstone, its funds, nor any of their affiliates takes any responsibility for, and has not independently verified, any such information.
Trends. There can be no assurances that any of the trends described herein will continue or will not reverse. Past events and trends do not imply, predict or guarantee, and are not necessarily indicative of, future events or results.