Nuts and Bolts: Adding Private Markets to Existing Portfolios (DIY vs. Outsource)

Private markets used to feel like a distant part of the investment landscape, out of reach and reserved exclusively for institutions and ultra-high-net-worth investors. That is no longer the case, and more advisors are now looking under the hood at the mechanics of private markets to see how they can fit into real-world client portfolios.

The number of publicly listed U.S. companies has declined significantly since the 1990s. Now, more than 85% of companies with revenue above $100 million are privately held. This means more of the economic opportunity set now lives outside the traditional stock and bond universe.

For advisors in this evolving investment landscape, the question is less “Should I use private markets?” and more “How do I add them, in a practical way, to portfolios my clients already hold?” In AssetMark’s 2025 Advisor Insights: Private Markets Report, 91% of advisors said access to private markets is key for differentiation, underscoring that the debate has shifted from whether to use them to how to implement them effectively.

The key is deciding whether you want to build your own allocations or lean on an outsourced solution, and how either choice best fits your practice.

Start with a plan, not a product

Before talking about structures or fund names, define the goal for a client’s investment portfolio and understand the role private markets will play. For many households, the goal is to:

• Enhance long-term growth

• Enhance income

• Enhance inflation hedges

In that context, a total allocation of roughly 15% of the overall portfolio can be reasonable for many clients. That range reflects a simple reality – private assets are less liquid.

Liquidity planning should sit alongside allocation decisions. That means understanding the repurchase features of interval funds and being clear with clients that these allocations are meant to be long-term investment positions.

DIY: Building private markets yourself

Advisors who choose a do-it-yourself (DIY) approach, own the decision on three things: selection, sizing and operations.

On selection, manager dispersion is real in private markets. Picking the right general partners and strategies matters. AssetMark analysis of Cambridge Associates data shows that the annualized performance gap between top-quartile and bottom-quartile private market managers ranges from 8 to 12 percentage points, underscoring how much outcomes depend on this critical decision. Our investment team leverages the “Five Ps” when evaluating funds:

• People: the experience, stability and alignment of the team

• Philosophy: a clear, repeatable way of seeking returns

• Process: how ideas become investments over time

• Portfolio construction and risk: how positions, sectors and geographies fit together

• Performance: results across market environments, with appropriate benchmarks

We pair that with operational due diligence to review controls, systems and governance.

Interval funds can be an effective access point if you understand what sits inside them. Some vehicles that look similar from the outside have very different levels of exposure to true private assets. It is important to know whether you are getting meaningful private market exposure, or mainly public market securities in a semi-liquid wrapper.

Sizing and operations are the other side of DIY. You will decide how much to allocate to each strategy and how to manage around varying liquidity windows. You will also need tools that can reflect those positions accurately in proposals, performance reports and reviews, alongside traditional holdings.

This path can be attractive for larger practices with investment staff, a clear view on which segments of private markets they want to emphasize and the technology to support more hands-on implementation.

Outsource: Let the platform carry the complexity

For many advisors, the more practical option is to outsource the heavy lifting and focus on the client conversation.

A strong outsourced platform can take on centralized due diligence, manager selection and the day-to-day operational workflows while giving you a menu of strategies you can plug into client accounts.

Ideally, public and private assets sit together on a unified platform with integrated proposal tools, rebalancing that accounts for liquidity, and consistent reporting so private markets feel like an extension of your current workflow rather than a separate system you have to bolt on.

The result is that you can spend more time helping clients understand why private markets are in their plan and how they fit, instead of managing paperwork or tracking multiple liquidity calendars.

Choosing the right path for your practice

When adding private markets, there are many options. As you consider your path, identify which responsibilities you want to manage directly and those that would benefit from management by a strategic relationship.

Here’s a simple decision framework:

1. Resources: Do you have the people and time to evaluate managers, monitor interval fund behavior and manage operational details yourself?

2. Client fit: How many clients truly need and can tolerate private markets exposure, given their goals and liquidity needs?

3. Control vs. scale: Where does custom selection add real value, and where would a curated, integrated solution let you scale private markets more efficiently?

Some advisors will choose a blended approach, using completion-style portfolios as a core and adding targeted positions on top for customized situations or investment convictions.

Private markets expand the investment universe. The advantage comes from knowing how to select the right pieces, size them and how they all fit together to create a portfolio that allows clients to stay committed through full cycles and pursue their goals with confidence.

For AssetMark advisors: putting this into practice

For advisors who already work with AssetMark, our new suite of private markets solutions is designed to support the same decisions outlined above.

With AssetMark’s private markets lineup, you now have several ways to answer the “how” question:

• Use semi-liquid interval funds from Apollo, Carlyle, KKR and StepStone as building blocks to create your own private markets allocation within UMA.

• Choose diversified completion private market strategies that are goal-based and can be combined with traditional public market portfolios.

• Access fully managed total-portfolio solutions that include private markets alongside public assets, implemented and monitored by our team.

In each case, the same underlying infrastructure applies. Due diligence is centralized. Public and private assets sit together on a unified platform with integrated proposal tools, rebalancing that accounts for liquidity, and consistent reporting. This is intended to make private markets feel like an extension of your current workflow rather than a separate system you have to bolt on.

IMPORTANT INFORMATION

Investing in private assets, which are accessed through private markets, involves significant risks, including the risk of complete loss. Past performance does not guarantee future results. There is no assurance that private asset investments will achieve their stated investment objectives.

Private asset investments are often illiquid, meaning an investor's ability to sell may be limited for extended periods of time. Investors with a future need for liquidity, i.e., access to cash, should carefully consider if private asset investments are appropriate for their particular financial situation. An investor's ability to make asset allocation changes to portfolios and to implement tax management strategies may also be limited.

Investing in private markets is intended for experienced and knowledgeable investors who are able to bear the risks of the investments. Financial advisors should conduct a due diligence review of private asset investments to determine if they are appropriate for their client's financial circumstances, including goals, risk tolerance, and overall portfolio objectives.

AssetMark, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission.

©2025 AssetMark, Inc. All rights reserved.

8684794.1 | 01/2026 | EXP 01/06/2028

For financial advisor use only.