Franklin Templeton survey of 700 Canadian investors exposes a sharp gap between alternatives ownership and investor understanding
More than half of Canadian investors have put money into alternative investments but fewer than one in four say they actually understand what they own.
That is the central finding of the Franklin Templeton Alternatives Survey, conducted between August 27 and September 9, 2026, which polled 700 Canadian investors aged 25 to 70 who are involved in household investment decisions and currently hold ETFs, mutual funds, or other investment vehicles, all with at least $100,000 in investable assets.
While 55.3 per cent of respondents have invested in alternatives at some point, only 22.6 per cent describe themselves as very or extremely familiar with the term "alternative investments." Ownership, in other words, has moved considerably faster than understanding.
Confidence gaps run deepest on fees and liquidity
When asked how confident they are about six aspects of alternative investments, respondents were most assured about returns and risk - roughly half said they were confident about how alternatives affect portfolio returns (49.7 per cent) and portfolio risk (49.6 per cent).
Confidence dropped sharply from there. Only 42 per cent said they understood the liquidity characteristics of alternatives, and fees were the weakest point of all: just 38.4 per cent expressed confidence in their understanding of costs, with an equal share actively saying they were not confident.
For advisors working to build alternatives allocations for clients, these figures mark the terrain clearly. Clients who do not understand fees and liquidity are clients who may panic at a gate event or balk at a lock-up. As Wealth Professional has reported, advisors want more alternatives but scaling up is the hard part and the data from this survey suggests the client education challenge is as significant as any operational one.
Private real estate leads; private credit and infrastructure trail
The survey also asked respondents about eight specific alternative categories, measuring familiarity, perceived legitimacy, return attractiveness, risk perception, and willingness to consider each.
Private real estate came out ahead across nearly every dimension: 66.7 per cent of respondents said they were at least moderately familiar with it, 83.6 per cent considered it legitimate, and 64.5 per cent said they would consider investing in it.
Digital assets and cryptocurrencies scored high on familiarity (58.3 per cent) but carried the heaviest risk perception of any category - 85.6 per cent of respondents described them as high risk, and only 46.2 per cent said they would consider an allocation. Commodities and private equity sat in the middle of the pack.
The asset classes advisors have arguably been most excited about - private credit and private infrastructure - ranked at the bottom for familiarity. Only 41.6 per cent of respondents said they knew private credit at least moderately well, and private infrastructure was recognised by fewer than one in three (32.7 per cent).
Despite that, infrastructure showed reasonable consideration rates (55.7 per cent) among those familiar enough to respond, suggesting the challenge is primarily one of awareness rather than rejection.
Advisors are the most trusted guide
When respondents were asked who they would trust for information about alternatives, financial advisors came out overwhelmingly on top - 73.7 per cent said they trust their advisor for guidance on these investments.
That figure dwarfed every other source, including financial news and media (which 28.4 per cent actively distrust) and social media influencers (distrusted by 66.1 per cent of respondents).
The implication for the wealth management channel is straightforward: when it comes to alternatives, the conversation that matters is the one that happens in an advisor's office. Clients are not going to self-educate their way into private markets through podcasts or Instagram. This aligns with the broader industry observation that Franklin Templeton Canada, which manages more than US$294 billion in alternatives globally, has consistently emphasised advisor education as a cornerstone of its Canadian distribution strategy.
Barriers are about confidence, not interest
The survey asked respondents which factors would prevent them from investing in alternatives. The responses clustered around confidence and information rather than outright disinterest.
Respondents pointed to complexity, lack of understanding, and uncertainty about fees as the most common deterrents - none of which are inherently insurmountable if addressed through clear advisor communication.
When asked what would make them more comfortable investing, respondents pointed to transparent fees, a verifiable track record, and an advisor recommendation as the top confidence-builders, each cited by between 25 and 39 per cent of the sample. Access through a fund or ETF structure also appealed strongly, with most respondents preferring familiar vehicles as the entry point to unfamiliar asset classes.
The next step leads back to the advisor
Asked what they planned to do next with alternatives, the largest single group of respondents (34.7 per cent) said they planned to ask their advisor for more information. A further share said they were waiting for their advisor to raise the topic. Just 12.6 per cent said they did not know where to start.
Taken together, these results suggest that Canadian investors are primed for the alternatives conversation. They have already entered the asset class in meaningful numbers. They trust their advisor above all other sources. And the barriers that remain - fees, liquidity, complexity - are precisely the gaps that a well-prepared advisor is positioned to close.
As Franklin Templeton Canada moves to expand private market access through its Quotential portfolio lineup, the survey results suggest the market infrastructure may be getting ahead of investor comprehension - and that advisors will need to close that gap before the opportunity fully materialises.
The Franklin Templeton Alternatives Survey was conducted using the UserTesting platform between August 27 and September 9, 2026. Results are directional and should not be considered representative of the broader Canadian population.
