Integrity Of Alts Providers A Top Criterion Say Advisors

PHILADELPHIA, Nov. 15, 2013 /PRNewswire/ -- Franklin Square Capital Partners, a leading manager of alternative investment funds designed for individual and small institutional investors, today announced the results of its recent survey conducted by Cogent Research, a division of Market Strategies International. The survey was intended to measure the attitudes of independent advisors and registered investment advisors toward alternative investments.

Advisors rated the most important criteria they use when selecting alternative investment providers. The survey found:

• A high level of integrity and transparency was the most important consideration when selecting a provider, with 92% of respondents ranking it among their top three criteria.
• Strong, consistent investment performance came in a close second, with 91% of those surveyed citing it among their top three criteria.
• A low degree of correlation to other asset classes was the third highest priority of advisors, with 82% of respondents ranking it in their top three considerations.
• Other popular criteria included competitive pricing (74%) and the length of a provider's track record (72%).
• Liquidity came in at the bottom of the list of factors in the survey, with only 38% saying they would choose a provider based on whether its products are fully liquid.

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"The results of this survey confirm the validity of our thesis that advisors and their clients want their asset managers to provide the same commitment to transparency and best practices demanded by large institutional investors," said Michael C. Forman, CEO of Franklin Square Capital Partners. "That's what we have stood for since our inception."

"Advisors want to do business with providers they trust," commented Ron Carson, CEO of Carson Wealth Management Group. "We, as advisors, should seek out firms whose money management approach produces solid results while truly embracing transparency and responsible business practices."

Although the majority of advisors surveyed believed alternative investments cost more than traditional investments, nearly eight in 10 advisors agreed that alternative investments' low degree of correlation to other markets makes them more suitable than other asset classes for portfolio diversification.

The survey also reveals insights into advisors' alternative investment strategies, with 89% of respondents indicating that they use mutual funds as alternative investment vehicles. REITs and ETFs that invest in alternatives round out the top three alternative investment strategies employed by advisors, followed by limited partnerships at 42% and business development companies (BDCs) at 39%. Commodities and managed futures were the least often cited alternative investment vehicles among survey respondents.

Finally, the results indicated that advisors prefer to learn about new alternative products and managers from wholesalers. Of those polled, the majority say wholesalers are best at educating advisors about new alternative investment managers and products and keeping them up-to-date on changes to existing alternative solutions.

Franklin Square currently manages three BDCs that provide individuals with access to credit-based alternative assets. The funds have been generating strong income and low-correlated returns for investors. Core to Franklin Square's philosophy is a steadfast adherence to best practices it considers essential to operating alternative funds responsibly. These include never paying distributions from offering proceeds or borrowings, investing significantly in its own funds, focusing on transparency in share pricing, and educating financial advisors and investors.

For more information about Franklin Square, please contact Dana Taormina at 973-850-7305 or [email protected].

Methodology
Survey results were taken from a poll of 268 independent brokers and registered investment advisors with assets under management of at least $10 million and annual revenues of at least $75,000. The majority of respondents held between $25 million and $500 million in assets under management and between $150,000 and $1 million in annual revenues at the time the poll was taken.

About Franklin Square
Franklin Square is a leading manager of alternative investment funds designed to enhance investors' portfolios by providing access to asset classes, strategies and asset managers that typically have been available to only the largest institutional investors. The firm's funds offer "endowment-style" investment strategies that help construct diversified portfolios and manage risk. Franklin Square strives not only to maximize investment returns but also to set the industry standard for best practices by focusing on transparency, investor protection and education for investment professionals and their clients.

Founded in Philadelphia in 2007, Franklin Square quickly established itself as a leader in the world of alternative investments by introducing innovative credit-based income funds, including the industry's first non-traded BDC. The firm currently manages three funds with over $9 billion* in assets. Forbes Magazine ranked Franklin Square 13^th on its 2013 list of America's Most Promising Companies. Franklin Square distributes its funds through its affiliated broker-dealer, FS² Capital Partners, LLC. For more information, please visit www.franklinsquare.com.

* Assets under management as of September 30, 2013.

About Market Strategies International
Market Strategies International is a market research consultancy with deep expertise in communications, consumer goods, energy, financial services, healthcare, technology and wealth management. The firm is ISO 20252 certified, reflecting its commitment to providing intelligent research, designed to the highest levels of accuracy, with meaningful results that help companies make confident business decisions. Market Strategies conducts qualitative and quantitative research, and its research specialties include brand, communications, customer experience, product development, segmentation and user experience. Founded in 1989, Market Strategies consistently ranks as one of the 25 largest global market research firms, according to an annual report published in Marketing News. Read Market Strategies' blog at FreshMR, and follow them on Facebook, Twitter and LinkedIn.

CONTACT:
Dana Taormina
JCPR
973-850-7305
[email protected]

SOURCE Franklin Square Capital Partners