ALTERNATIVE REAL ASSETS IN A PORTFOLIO CONTEXT

Wolfgang Mader, Sven Treu and Sebastian Willutzky
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Wolfgang Mader: risklab GmbH, Seidlstraße 24–24a, 80335 München, Germany
Sven Treu: risklab GmbH, Seidlstraße 24–24a, 80335 München, Germany
Sebastian Willutzky: risklab GmbH, Seidlstraße 24–24a, 80335 München, Germany

Chapter 3 in Alternative Investments and Strategies, 2010, pp 51-69 from World Scientific Publishing Co. Pte. Ltd.

Abstract: AbstractIn this chapter, we are introducing the asset class “Alternative Real Assets”. This asset class provides access to “real” investment opportunities, real meaning both partially inflation protected and solid, via limited partnership fund structures. This (sub-)asset class comprises fund vehicles that invest, for example, in infrastructure, shipping, or renewable energy projects. For some of these alternative real assets, financial incentives are provided, such as preferential feed-in tariffs for solar–generated electricity.We discuss alternative real assets, including a comparison to other asset classes and a description of distinctive features, with a focus on photovoltaic investments. The bottom-up modeling approach of individual photovoltaic projects and the approach to incorporate these investments in portfolio analytics are presented. Based on a comprehensive framework, we are finally able to evaluate the benefits of photovoltaic investments in a multi-asset portfolio.Investing in photovoltaic facilities is environmentally supportive. We are able, as well, to show that under reasonable assumptions, financing solar plants is an attractive asset class, both stand-alone and in a portfolio context.

Keywords: Alternative Investments; Portfolio Selection; Trading Strategy; Product Innovations; CPPI; Portfolio Optimization; Portfolio Insurance (search for similar items in EconPapers)
Date: 2010
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