It’s a saying with the requisite amount of bravado to stiffen one’s upper lip and shore up one’s resolve as we plough through yet another tough market cycle; a period in which, by all traditional measures, “alternative” investments should be a good place to seek shelter from the storm.

This time may be different, of course.  Real estate, one of the most popular (at least in terms of its presence in pension portfolios), served to set off most of the recent market tumult, and is still struggling to make its way back (though one should be careful about the level to which one expects it to return).  Private equity, writ large, feels a more precarious move at present, and hedge funds—well, many no longer live up to the name, despite their fee structures. 

There are, of course, a growing number of alternatives to stocks and bonds—the traditional standard against which an investment is deemed to be “alternative”—but to boldly go where no one else is going is generally anathema to pension plan fiduciaries. 

Of course, there will be (and perhaps already are)  institutional investors with a perspective and horizon long enough to wade into this storm surge, those whose skins are “tough” enough to make the kind of prudent investment in strategies and sectors that can (and often has) pay big dividends in the long run. 

But caution seems to be the watchword of the day, and many—perhaps most—are not altogether certain that we have weathered the storm.  The world’s pension obligations loom large, the returns needed to sustain them less certain, the pockets from which new investments arise already “picked.”  In a growing number of places, those already dependent on such promises are rioting in the streets (some days it seems likely that those expected to fund those obligations may join them), but those protests will not fill those depleted coffers, nor will they likely have any good effect in ameliorating the current market unsteadiness.

The going’s still tough—but the tough will, as they are wont to do, keep going. 

The question, as yet unanswered, is where—and what—they will be going to.