High-net-worth individuals are increasingly diversifying their wealth beyond traditional asset classes like equities, debt, gold, and real estate, allocating capital to private credit, alternative investment funds, and global portfolios.
Equities Remain Growth Engine While Alternatives Gain Ground
High-net-worth individuals are looking past traditional asset mixes to incorporate private credit, alternative investment funds (AIFs), portfolio management services (PMS), private equity, and global investments into their wealth strategies. This shift does not mean traditional assets are disappearing. Instead, investors are assigning different classes to specific purposes, ranging from growth and income to liquidity, hedging, and diversification.
Equities occupy a central position in these portfolios as the primary growth engine, according to Chirag Mehta, founding partner at Arbour. Investors are examining how portfolios behave during difficult market conditions and seeking steady cash flows alongside equity exposure.
Within equities, investors are becoming more selective. Ankit Patel, co-founder and partner at Arunasset Investment Services, notes a rising interest in mid- and small-cap strategies, PMS, and differentiated active strategies. Global exposure is also expanding. Tajinder Virk, co-founder and CEO of Finvasia Group and Dealing.com, states that high-net-worth individuals are looking at global equities alongside domestic investments to diversify across geographies, currencies, and economic cycles.
Debt, Gold, and Real Estate Retain Specialized Roles
Traditional asset classes continue to play specific parts in modern portfolios. Debt is utilized for stability, predictable income, and liquidity, according to Shrikant Goyal, managing director at Getfive Funds, a SEBI-registered Category-I Alternative Investment Fund managed by Getfive.
Gold serves as a traditional hedge and portfolio diversifier. Patel explains that gold has become a more meaningful strategic diversifier, while Virk points to growing interest in financial and digital forms of gold.
Real estate remains a core component, though investors use avenues beyond direct property ownership. Patel highlights the increasing use of real estate investment trusts (REITs), real estate funds, and structured vehicles alongside physical property. Pradeep Aggarwal, founder and chairman of Signature Global (India) Ltd., notes that direct property demand remains strong in select micro-markets and branded residences, but cautions that real estate is an illiquid asset requiring longer holding periods.
Family Offices Increase Allocations to Alternative Investments
The most notable change in high-net-worth portfolios is the growing allocation to alternative investments, including private credit, private equity, venture capital, and co-investments. Goyal cites the Julius Baer–EY India family-office study, indicating that alternatives account for roughly 40 to 45 percent of allocations in many family offices. Saket Lakhotia, co-founder and group CEO of Daksham Capital, observes that alternative allocations in some family offices are moving from previous levels of around 10 percent toward 25 percent.
Private credit is seeing particularly high activity. Mehta cites EY data showing $12.4 billion of private credit deals in India in 2025, representing a 35 percent increase, with real estate leading the sector. Virk notes that private markets, long-short strategies, and real-world assets are attracting attention, though he cautions that investors eyeing tokenized assets must examine legal ownership, custody, investor protection, and regulatory clarity.
Assessing Liquidity and Underwriting Discipline Before Investing
Financial advisors emphasize that capital allocation to alternatives requires careful planning around liquidity. Goyal advises investors to evaluate the role an investment plays in the portfolio and determine how much capital they can afford to keep patient. Because alternatives often feature lock-ins or limited exit opportunities, investors must match their investment horizon with their liquidity requirements. Patel warns against allocating money needed for near-term goals or emergencies, while Lakhotia stresses the necessity of understanding lock-in periods and exit mechanisms.
When evaluating private market investments, headline returns require deeper analysis. For private credit, Mehta advises looking beyond the coupon to examine collateral, cash-flow coverage, and legal documentation. Patel points to borrower quality, covenants, recovery mechanisms, and manager underwriting discipline as critical factors, noting that a manager’s experience and track record remain relevant across all alternative asset classes.
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