The performance of some kinds of alternative investments during the financial crisis caused some advisors to take note. "The traditional 60/40 model failed or underperformed in 2008," explains Dave Wolf, an advisor at United Community Bank. "Studies show that adding 20-30% alternatives to a portfolio gets you both a higher return and a better standard deviation." Wolf says it was the performance of university endowments -- which invested in assets like real estate and private equity funds -- during the crisis that drew his attention to alternatives.
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