Investing Beyond Public Markets W/Tony Davidow
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Episode Description
Welcome to the Freedom Point Podcast! In this episode, Jeremy talks with Tony Davidow, Senior Alternatives Strategist at Franklin Templeton, about how investors can unlock the potential of private markets through education, diversification, and long-term strategy. Tony breaks down the difference between public and private investing, the evolution of access to alternative assets, and how advisors are adapting to a new era of opportunity. They explore why illiquidity can be an advantage, how institutions and family offices allocate differently, and the growing role of education in bridging the gap for everyday investors. Tony also shares insights from his book Private Markets: Building Better Portfolios with Private Equity, Private Credit, and Private Real Estate—a must-read guide for anyone looking to invest smarter, not just bigger.
Summary
Tip #1: The Investing Landscape Is Expanding
“We now have access to world-class private market products—and advisors need to help investors understand how to use them.”
Tony explains how new structures and lower barriers are opening access to private equity, private credit, and real estate investments once limited to institutions.
Tip #2: Know Where Your Advice Comes From
“Not all advisors are licensed or trained to advise on private investments.”
He emphasizes the importance of understanding your advisor’s capabilities and whether they can guide you on both public and private opportunities.
Tip #3: Advisors Are in the Learning Curve
“We’re still early—some advisors are skeptics, some are dabblers, and a few are power users.”
Tony categorizes the current advisor landscape and notes that education and experience are driving broader adoption across the wealth management industry.
Tip #4: Private Markets Offer the Illiquidity Premium
“Private equity has historically delivered a 300–500 basis point premium for investors willing to tie up their capital.”
He highlights that long-term, illiquid investments can outperform public markets—but require patience and planning.
Tip #5: Build an ‘Illiquidity Bucket’
“Create a portion of your portfolio you don’t touch—it’s your long-term, patient capital.”
Tony advocates for intentionally setting aside capital for illiquid investments, creating discipline and reducing the temptation to react to short-term volatility.
Tip #6: The Cost of Being Too Liquid
“The cost of liquidity is missing out on opportunity.”
Investors who avoid private markets often lose the higher returns and diversification benefits these assets can provide.
Tip #7: Education Is the Bridge to Confidence
“We’re in the second or third inning—education will move investors from 5% allocations to 15–20%.”
Tony believes that informed investors and advisors will gradually increase their exposure to alternatives as understanding grows.
Tip #8: Today’s Environment Creates Opportunity
“Properties are trading below replacement cost—smart managers are deploying capital intelligently.”
He discusses how current market dislocation in real estate and credit markets is creating compelling long-term entry points.
Tip #9: Secondary Markets Are Attractive
“Institutions selling private equity positions has created discounted buying opportunities.”
Secondary markets allow investors to buy seasoned assets at better pricing, benefiting from supply-demand imbalances.
Tip #10: Illiquidity Builds True Wealth
“Volatility tests short-term investors—but illiquidity rewards patient ones.”
Tony reminds investors that the best long-term returns come from committing to disciplined, illiquid strategies.
