26 Feb

Blackstone Group: The $290 billion alternative investment manager

WRITTEN BY Robert Karr

Active fund manager

Blackstone Group (BX) is an alternative investment asset manager with almost $290 billion in assets under management as of December 31, 2014. The company also provides financial advisory services to clients around the globe. Two of Blackstone’s primary limited partners are corporate and public pension funds. Limited partners commit capital to private equity players to earn better returns than indexed returns.

Blackstone Group: The $290 billion alternative investment manager

Alternative investment management is an active style of investing. It attempts to outperform the major indices, such as the S&P 500 (SPY), instead of replicating returns as is the case in passive fund management. Active fund management generally requires a performance fee over and above a certain fixed fee for managing funds.

Product offerings

Blackstone’s alternative asset management includes investment vehicles focused on private equity, real estate, hedge fund solutions, fund of funds, non-investment grade credit, and multi-asset class exposures outside of other funds’ mandates. The company also provides these financial advisory services:

  • financial and strategic
  • restructuring and reorganizing
  • capital markets
  • fund placement

Inorganic growth strategies

Blackstone pursues inorganic growth strategies to expand its market and foray into different product categories. These are some of the company’s high-profile investments and acquisitions:

  • Strategic Partners Fund Solutions – private equity arm of Credit Suisse (CS)
  • Vivint – security provider
  • CT Investment Management – an investment management unit of Capital Trust
  • GSO Capital Partners LP

Blackstone faces competition in the alternative management space from The Carlyle Group LP (CG), KKR & Co. (KKR), Apollo Global Management (APO) and T. Rowe Price Group (TROW), all of which are known to pursue similar inorganic growth strategies. TROW makes up 0.72% of the Financial Select Sector SPDR Fund (XLF).

Latest articles

Hexo (HEXO) had a hard time last week. A lot of headwinds pulled the stock down. However, the stock rose and closed with a gain of 17% on Thursday.

Elliott Management expects AT&T stock to reach $60.0 by the end of 2021 if it adopts the restructuring plan. The stock has a potential upside of almost 60%.

Tesla (TSLA) stock is having a strong run this month. After a weak start, the stock has closed with gains for nine consecutive trading days.

Chipotle is scheduled to report its third-quarter earnings on October 22. Despite the rise in the stock, Chipotle's earnings could drive the stock more.

The Cannabis 2.0 era has officially started. Now, Canadians can legally access a host of cannabis-infused products like beverages, vapes, and edibles.

Despite vaping concerns, Aurora Cannabis plans to introduce vape products in December. Reports of vaping-related illnesses started in late August.