➡ Large institutions are increasingly investing in private equity due to its performance, with endowments allocating 25-32% of their funds to it. However, while private equity has shown growth, NASDAQ has outperformed it over one, three, five, and ten years. Bitcoin has shown the best performance over these periods, despite its volatility. The unlocking of $9 trillion from 401ks could potentially lead to a significant increase in investments in alternative assets like private equity, real estate, and Bitcoin.

➡ The article discusses how changes in laws and technology can lead to significant increases in the value of certain assets, like gold in the 1980s. It suggests we’re currently in a similar situation, with $9 trillion ready to be invested in new asset classes like cryptocurrencies due to changes in retirement account rules. This isn’t a temporary shift, but a major change in the financial market, potentially leading to the largest wealth transfer in history.

What happens when $9 trillion dollars in boring 401k money gets permission to chase yield? Because that’s about to happen. Trump’s signing the order. The game is about to change forever. I’m talking about trillions of dollars that have been stuck in losing or low yielding retirement accounts, now being able to go buy Bitcoin or private equity or real estate. And for the first time in history, now this isn’t speculation, it’s happening. And here’s what everybody’s missing. This is about the entire financial system reorganizing. When the safest, most conservative money in America retirement accounts starts chasing alternative assets, you get what’s called an asset supercycle.

Now the kind that creates generational wealth. So in this video, I’m going to show you exactly which assets explode first. The timeline that Wall Street doesn’t want you to see and how to position yourself before the herd arrives. So let’s go. All right, so we are talking about one of the biggest moves in the financial system that we’ve seen to date. And of course, it all comes on the back of Trump’s executive order. Another one. Now he’s racked up quite a bit of executive orders. Not something I’m super fond of, but anyway, that’s beside the point.

There’s a whole other topic for another video. What we’re talking about is his executive order that’s unlocking about $9 trillion dollars and a massive amount of money. About $43 trillion total are in these retirement accounts in the financial system. But this is affecting about $9 trillion. Now the big move is that it can now take money, the 9 trillion in 401ks, and can push them into what we call alternative assets. Now alternative assets is where I’ve basically made my entire career. Forget the stock, the S&P 500. We’re talking about alternative assets.

I’m going to break that down for you. Now, part of the reason why is because of course the S&P 500 hasn’t really been getting people where they need to be. We know that about half of all baby boomers are broke. They have no money. Number one. Number two, of the half that do have money, it’s on average about $240,000. So we need to get the returns to improve. We need to get them to make more money if they’re going to have any success or any hope of retirement. Now, part of the reason why they’ve not been able to do this so far is because apparently it’s too risky.

People aren’t smart enough to know what they’re doing. It’s too volatile. So we must protect them. At least that’s what the government thinks. And Trump says no more. No more of that. So he signed this executive order to specifically allow people to take their own money and their 401k that they was holding the back from what they want to invest into. And now they could direct it. Now, a couple of things that I think are worth noting in this specifically is we can see that this order unlocks a massive opportunity for PE firms, private equity, and crypto investments.

So Bitcoin and cryptocurrencies, like I said, about $9 trillion. The White House officials said alternative assets, again, not the S&P 500, they offer competitive returns. We need them to get their returns. It offers diversification benefits and will improve Americans’ retirements prospects. That’s the key piece. We need to get them a little bit more money if they’re going to have success because surprise, surprise, social security is not going to be there. Okay. It says that typically they have a responsibility to plan participants, people in the 401k, to select appropriate investments and alternative investments often are more volatile than typical funds.

Okay. So they’re trying to protect them. They don’t want them to diversify out too much because typically alternative investments are more volatile. Okay. I’m going to show you some of the data around that. So this is a chart right here of the Treasury bonds. This is represented by the TLT, which is an ETF of the long US Treasury bond, which is supposed to be the risk-free rate. It’s the bedrock of the global financial system. And what this shows us is that over the last five years, you’ve lost about 50% of your money.

Now, most financial plans in a 401k your financial advisor puts you into is something what’s called a 60-40 portfolio, meaning 60% of your money is in stocks, 40% of it is in bonds, and look at what’s happened. You’ve lost 50% of your money. So rather than your money being stuck and your plan advisor putting you into plans like this that lose money, I think it’s a good idea to let you choose where you want to put your money. But let’s explore the alternative investments. Okay. The three horsemen of these alternative investments.

We’re talking about real estate. We’re going to dig into that. Private equity. We’ll take a look at that. And of course, my favorite Bitcoin. We’ll take a look at that. So let’s go through these one at a time. Let’s start with real estate. Of course, if you’ve been following me for any time, you know that I started my career in real estate. I still own real estate. I like real estate, but there’s a couple things that we should know, specifically around in your 401k in a retirement account. They talk about liquidity.

They talk about volatility and real estate is certainly illiquid. You can’t sell it quickly. At best case scenario, it’s probably a couple of months. Sometimes it could be even worse depending on the market cycle where you’re located, things like that. The other thing with real estate is that there’s high transaction costs. It’s very expensive to sell a piece of real estate. It’s also big, big sales, big purchases, big amounts. So let’s just say you needed $5,000 for a purchase or $10,000 for a vacation. You can’t just get five or $10,000 out of your house.

So it’s illiquid. There’s high transaction costs to move them. And so most likely if people were going to use this in a retirement account, they’d probably use something like a REIT, a real estate investment trust, something like that. They wouldn’t want to own it directly. They wouldn’t want the maintenance headache. They wouldn’t want the property managers getting calls late at night when your toilet’s breaking down, things like that. Some other things with real estate in a retirement account that can be problematic is a geographic concentration risk. But if we take a look at the case shiller index for real estate, we can see a couple things.

Number one, this goes back to 1988. Real estate had been pretty much flat here until the dotcom bubble blew up. When the dotcom bubble blew up, rates went down. Real estate went up into a bubble. 2008, we had the real estate crash and we’ve been based on an upward trend ever since. So for the last couple of decades, real estate has been a pretty good investment. Now let’s stack this up and take a look at it in a chart here. So what we have here is REITs versus direct. So how should we own real estate, especially if we can get money from our retirement account into real estate specifically.

So the investment type here is an equity REIT. Here is a private CRE, commercial real estate. And here we have US home prices. And what this shows over one year, the REITs have performed better in a one year period, 8.7 versus 2.6 and 2.7. Over three years, they didn’t do too well. However, they lost less, let’s just say, than commercial real estate. And over five years and over 10 years, they outperformed. So if I was going to move some of my money in my 401k, into one of these horseman’s, into the real estate bucket, the equity REITs are probably the best option for me in this scenario.

Now, of course, there’s more advanced options. We’re not talking about that. We’re just talking about in your retirement account specifically. It looks like it’s winning there. Okay. Remember those numbers. We’re going to stack all these up at the end. Okay. The second horseman would be in my alternative investments is private equity. Now, Tony Robbins recently wrote, I believe his third book on money, part of the trilogy, where he talked about private equity being one of the best investments that you can get into. And he talks about where typically you’re going to make 20 to 30% on your money versus SP500, 6 or 8% return.

A couple of things to know about private equity, typically they have pretty high minimum investments. So typically you probably need to be an accredited investor. It means you’re making over $250,000 or a million dollars of assets. And typically you need to put $250,000 up to $1 million into private equity. Also, the thing with them is they’re not very liquid. Typically you have to lock up about five to 10 years when you put your money into the fund, it’s stuck there. You can’t get it back for like a five to 10 year period.

Not ideal. If you’re towards the end, nearing your retirement, obviously, if you’re just starting out, maybe that works okay. As I said, typically you have to have an accredited investor requirement, of course, liquidity issues. If you’re within that lockup period, you can’t get any of your money out. And then typically they have very high fees. So you’re typically going to pay two or 20. What that means is of the money that you have in the fund, they’re going to take 2% as management fees. So every year, 2% of the money you have in goes to management.

And then on the upside, they’re going to take 20% of the gains that they get you. Okay. Let’s take a look at how this is working out. What we can see here is that we are currently getting more and more allocations going to private equity from large institutions. And the reason why is, again, because of their performance, right? Because they’re beating regular funds. And what we can see here is the allocations we see for endowments and foundations, they’re the leader in allocating to private equity, endowments being like Yale, Harvard, things like that.

We can see they’re allocating about 25 to 32% of their entire fund towards private equity. Just so you can see how they’re allocating this. Again, most people, most individuals don’t have any, but the endowments they do 25 to 32%. Okay. What we can see is since they’ve been doing this and sort of going back to Tony Robbins book, we can see the growth. Here’s the year 2000 and look at the amount of growth. Here we are. This is only to 2022, but you can see the enormous move from money going into private equity, chasing yield.

The S&P 500 hasn’t been performing well. The MAG 7 have 493 other companies not doing so well. And so they’re chasing yield. Where do we get it? Well, they moved to private equity. Well, let’s stack these up and take a look at what we’ve got so far. And what we can see, here’s the assets. We have private equity right here. Here’s the S&P 500, NASDAQ, the Russell 2000, and then the Treasury bond. What we can see over one year, three or five years and 10 years. And what we can see is that while private equity looks really good, actually the winner has been the NASDAQ.

What we can see over one year, three years, five years and 10 years, we have 7.1%. The S&P 500 did better over one year. The NASDAQ did even better in the one year period. Over five years, we got 7% here in private equity, almost 11% in the S&P 500, eight and a half in NASDAQ. Five years, 16% in private equity, about 16% in S&P 500, but almost 19% in the NASDAQ. And over 10 years, we have 15% in private equity, 13% in the S&P 500 and 16% in NASDAQ. So all of them are actually pretty close.

Now, of course, this is a private equity index. Some have done way better, some have done way worse. What we can see is somewhat pretty close. Now, the Russell index has done pretty poorly overall, hasn’t kept up about half of that. I did put the US Treasury bonds on here, just so you could see, over one year lost 5%, over three years lost 10%, over five years, they’ve done pretty terrible. We also have real estate down here at the bottom, 10%, 4%, 6.5% and 6%. So what we can see here is that the NASDAQ has been better performing than real estate and private equity.

And of course, most of you can buy the NASDAQ and the S&P 500 in your 401ks right now. You don’t need alternative investments to do that. Okay, let’s go to the third horseman of alternative investments. My favorite, of course, Bitcoin. Now, part of the reason why I love Bitcoin is it’s brand new, it’s technology, it’s changing the world as we know it, but it’s also had the best performance. It has been the best performing asset over pretty much any period in time, 15 years, 10 years, five years, three years, and one year.

Let’s take a look at it when we stack it all up. So if we have private equity, S&P 500, NASDAQ, Russell, Treasury, and now we have Bitcoin here. So instead of 7%, 24% or 29%, the NASDAQ looked really good. Bitcoin did 70, not 29, 70. Over three years, we had the winner here, the S&P 500 at 10.9, but Bitcoin did 63%. Over five years, we had the winner right here at NASDAQ, 18%, but Bitcoin did 82%. Over 10 years, we had the winner right here, again, back to the NASDAQ at 16%, but Bitcoin did 139%.

So pretty much over any time period you want to look at, Bitcoin has outperformed. Hard to argue with that. But how people would argue with it, but they’d say, but the risk, it’s too volatile. Well, what we want to do as investors is we think about the risk adjusted returns. One of the ways we do that is we use something called a sharp ratio. The sharp ratio looks at both the risk and the reward that we have. So if we take a look at the sharp ratio of a couple assets, let’s look specifically at the sharp ratio of Bitcoin and the US Treasury.

Specifically, what we can see is that the max drawdown of the US Treasury for the last five years, ending June 30th, 2025, was 48%. About half your money was lost holding US Treasuries. In Bitcoin, it went down, the max drawdown was actually 76%. So the drawdown was much worse. However, if we look at the sharp ratio, which looks at both the drawdown and the return profile, we see that TLT was 0.39, which was very risky. We see that Bitcoin was over one, which was much, much safer. And the reason why is because you have to look at both the return and the gain or the risk and the reward, I should say.

So when we look at TLT over one month, three months, six month, one year, three or five years, and we see that again, it is down heavily five years, 38%. But if we look at Bitcoin, it was all gains, over a thousand percent gain. And so you have to understand risk and reward in both of these. And so we can see across the board, Bitcoin wins. But a couple things to keep in mind, it’s not just about total performance, total volatility, total risk. We also want to think about liquidity. How fast can I get my money out? Like with real estate, specifically, if I have single family residents, how long does it take me to get money out? If I just need a little bit, 5,000, 3,000, 20,000, how liquid is that market? All right.

Now let’s get to the super cycle part of this. Because as I said, we have about $9 trillion that’s going to be unlocked and it’s going to rush into these types of assets. So what does history say about this? What can we learn? Well, a couple things that we can learn. First of all, we know that the 401k was created by the revenue act in 1978. Okay. So this is when they changed things when money started flowing into it. We know that stocks became standard in a 401k around the early 1980s.

We saw that the S&P 500 in 1981 was about 130 and today it’s about 5,800. That’s a 44 times increase since the 401ks came into existence and started buying stocks, what we call passive flows, passively buying them. Now, this is different than retail investing. Retail investors are trying to time things. Should I buy now? Should I wait? 401ks are every other week. My paycheck has money that goes into my 401k and it automatically buys back to the passive income. But for an illustrative chart, we can see here from 1930 until this point when the 401s were created in 1980, we can see that the S&P 500 was relatively flat.

Yes, it went up and down, but it was relatively flat. But look at what happened since 401ks started buying the S&P 500. It started going straight up. So if history is our guide, and we now know that the 401ks can unlock and that capital can now move into three types of alternative assets, what do you think happens to those three types of alternative assets? Well, that may not be definitive, but let’s put a number on it here. What we can see is that if we do the math on how the capital should flow, we can see again, if there’s $9 trillion sitting in 401ks, if 1% of that allocation moved into alternative assets, that’s almost $90 billion.

If 10% of that moved out of 401ks and into one of these three assets or all three, that’s almost $900 billion. Now, just to put things into some math, if that’s almost $900 billion, the entire crypto market is only $4 trillion. Bitcoin is only about $2 trillion. So what happens when almost 1 trillion moves into a $2 trillion market? Yeah, it explodes. You can do the math, but let’s look at some other parts of history. What we can see here is we can understand that pension funds entered also into stocks in the 70s.

We know that insurance companies started buying real estate in the 1980s. We know that endowments, they started moving into stocks in the 1990s. This is into private equity and venture capital, and we got the tech boom. But now we have retirement accounts moving into this new alternative investment class. Let’s take a look at some more charts. So let’s look at gold, for example. We can see what happened right around the same time, 1980. Gold had been kind of moving higher, and then look at the growth that we have right there. As a matter of fact, you can see before it happened and after, before gold became legalized.

A lot of people don’t understand this, but back here, well, we don’t go that far back. In 1933, the US government took everybody’s gold and made it illegal to even own gold. And it wasn’t until here that you were able to own gold legally again. So again, when a rule change happened legally and people could move their money into the asset, what happened? Well, gold went up, as you can see, over four times. This is the history, and this is what happens when money gets unlocked and can move into new assets. It creates a super cycle.

So I’ve been talking a lot about something I call the quantum wealth window. About every 50 years, we have a technological revolution that opens up. Now, there’s two things that happen. One, the technology changes the course of humanity, right? Like instead of walking and riding horses, we didn’t have cars, right? Instead of having to send a letter in the mail, we now have the internet and email. And we have that going on right now. We also know that the richest people in the world, the legacy wealth was always created in one of these wealth windows.

Now we are in the sixth wealth window we’ve seen in the last 300 years. And at the same time, we’re seeing this, we’re seeing now $9 trillion being unlocked and ready to rush into these new asset classes, cryptocurrencies, Bitcoin, et cetera. Now, this isn’t just another trade. It’s not a short term move. This is a structural reformation of the entire capital market, right? Not another trade. We’re talking about $9 trillion that just got permission to now come out of their locked gates in a 401k and can now come into these assets.

Again, not a correction, a reformation, and this is the greatest wealth transfer in history. Now, if you want to know more about how we’re positioning for these and how that money might move into Bitcoin and where that goes over the next 10, 20, 30, 40 years, you might want to watch this video right here and I’ll see you over there. [tr:trw].

See more of Mark Moss on their Public Channel and the MPN Mark Moss channel.