Designed to serve as your primary source for navigating the world of alternative investments.
For the third consecutive year, global transaction volume exceeded $100 billion. That momentum is largely due to the abundant growth in the primary private equity market and limited partner (investor) demand for liquidity following two years of muted exit activity.
General partners (GPs) are increasingly looking at secondaries to provide liquidity for their limited partners (LPs), while LPs are embracing the market as an effective portfolio management tool. In fact, we believe the sustained size of secondary deal activity has established secondaries as central to how the private markets function. So much so that secondary funds, or funds that acquire pre- existing investments of private equity portfolios, are now an increasingly popular investment option within the private wealth channel.
Private equity secondaries may offer investors a particularly attractive entry point, or discount, relative to primary private equity funds because of their unique risk and return profile. In addition, secondaries are generally well diversified and typically provide a faster return of capital, relative to primary private equity funds. These factors can be particularly enticing for investors that are newer to private equity.
Given the role that secondaries now play in the private markets – and the number of asset managers that are expanding their secondaries business with strategies to grow their presence in the private wealth channel – we expect the appeal of the asset class to continue to broaden.
Thank you for your continued partnership and support.
Dan Vene
Co-Founder and Managing Partner,
Co-Head of iCapital Solutions
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ALTERNATIVE INVESTMENTS ARE CONSIDERED COMPLEX PRODUCTS AND MAY NOT BE SUITABLE FOR ALL INVESTORS. Prospective investors should be aware that an investment in an alternative investment is speculative and involves a high degree of risk. Alternative Investments often engage in leveraging and other speculative investment practices that may increase the risk of investment loss; can be highly illiquid; may not be required to provide periodic pricing or valuation information to investors; may involve complex tax structures and delays in distributing important tax information; are not subject to the same regulatory requirements as mutual funds; and often charge high fees. There is no guarantee that an alternative investment will implement its investment strategy and/or achieve its objectives, generate profits, or avoid loss. An investment should only be considered by sophisticated investors who can afford to lose all or a substantial amount of their investment.
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