Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
Blackstone is joining forces with asset management companies Vanguard and Wellington Management in a “strategic alliance” aimed at creating hybrid public and private funds for wealthy individuals and retirees.
The three groups said on Tuesday that they would work together to create blended products containing both public and unlisted assets, and funds with exposure to active and passive investments.
While Blackstone, Vanguard and Wellington did not announce any specific products, stating that such details would be announced in the coming months, the three-way partnership underscores the latest push by the private equity and credit industry into the portfolios of individual investors.
The alliance signals that alternative asset management companies such as Blackstone increasingly believe they can blend unlisted investments from their investment portfolios with public debt and equity products.
The three firms said they aimed to build “fully diversified portfolios that incorporate private assets and pursue higher returns” for individual savers.
The deal also highlights the persistent efforts of traditional managers such as Vanguard, the world’s second-largest asset manager, to bolster their private capital offerings.
Greg Davis, Vanguard’s president and chief investment officer, said the alliance with Wellington and Blackstone would “help more investors benefit from broader access to private investments by further increasing diversification and pursuing higher returns”.
Jean Hynes, chief executive of Wellington Management, said: “Vanguard and Wellington have worked closely together for 50 years and have long admired Blackstone’s capabilities”.
In recent months, private capital giants including Apollo Global, Partners Group and KKR have worked with asset managers including State Street, BlackRock and Capital Group to create new private funds for more mainstream investors.
The private market deal between the three managers comes as levels of volatility in public investments have hit multiyear highs in the wake of US President Donald Trump’s tariffs blitz.
Government bonds — traditionally seen as a stable, haven asset class — have swung wildly in recent weeks as equities fell into correction territory before fluctuating amid escalating trade tensions and policy uncertainty from Washington.
Blackstone president Jonathan Gray said the partnership announced on Tuesday would “further expand the benefits of private markets” for Vanguard and Wellington’s clients.
Read the full article here
