Germans start to look at alternatives: Oppenheim

By Tom Burroughes

GENEVA (Reuters) - Rich German investors, while inherently cautious about alternative assets such as hedge funds, have made big strides toward accepting them over the past five years, said a partner at family-owned bank Sal. Oppenheim.

Alternative assets make up 5 to 7 percent of the wealth managed by Sal. Oppenheim, Christopher von Oppenheim told a Reuters summit in Geneva on Tuesday.

"Five years ago, this (allocation) would have been zero," said the partner at the blue-blooded German private bank.

But the move into alternative assets has yet to become a stampede, he said. "Germans are still, in their asset allocation, quite conservative.

The wealthy business families that form a large chunk of the German private bank's client base hold about 60 to 70 percent of their wealth in their own businesses, 15 to 20 percent in property and 5 to 15 percent in liquid assets, he said.

Globally, investors have poured money into alternative assets in recent years. The hedge fund sector holds up to $1.7 trillion, according to some industry estimates.

Well-heeled private investors and institutions such as pension funds are being encouraged by financial advisers to consider alternative assets to avoid heavy exposure to stocks and bonds and get new streams of investment returns.

EARLY STAGE  Continued...