Blackstone Group LP is preparing a mutual fund-type offering to take advantage of growing demand for alternative products among individual investors, Chief Executive Officer Stephen Schwarzman said.

"We have one product that's going to be coming out, a mutual-fund complex," Schwarzman said Tuesday at the Morgan Stanley Financials Conference in New York. "This is getting slow and steady receptivity. This is more of an everyday-type offering."

Schwarzman, who co-founded New York-based Blackstone in 1985 and helped build it into the world's biggest alternative-asset manager, said retail investors increasingly understand alternative assets. Advisers are also seeking exposure to alternatives such as private equity, real estate and hedge funds for their clients because the offerings have historically outperformed broader markets, he said.

Tom Hill, head of Blackstone's hedge fund-of-funds business, said at the firm's investor day last month that the firm was planning to start a mutual fund this year as it seeks to attract money from defined-contribution pension plans.