Nearly half of LPs view secondaries as a core pillar of their alternative assets strategy
When looking at the year ahead, 37% of LPs plan to increase their allocation to alternatives overall. Delving into the nuances in responses across various strategies, 37% of LPs stated that they plan on increasing their allocation to private debt, reflecting the growing enthusiasm for this segment. Private equity and infrastructure followed closely, capturing investor interest, with LPs intending to increase allocations by 34% and 33% respectively.
Secondaries continues to further cement their place in the alternatives landscape with 45% of LPs telling us that the strategy now represents a core pillar of their alternative assets programme.
We also examined continuation vehicles (CVs) from the viewpoint of investors. Recent trends point towards greater acceptance and understanding, accompanied by robust demand, as CVs firmly establish themselves as a viable exit strategy and a path to liquidity.
Many market participants have gained deeper understanding and exposure to continuation funds and we expect a sustained increase in appetite for these vehicles.
Over half of LPs believe they represent an opportunity to maximise value for strong performing assets or retain them for longer in order to extend the investment horizon and capture additional upside.
The remainder of respondents believe CVs serve as a means of providing GPs with an alternative to selling at a low valuation. Although the material difference lies in whether a lower valuation is a reflection of the state of the market or the state of where the asset is at.
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In this winter 24/25 edition of the Barometer, we asked a number of questions about alternatives....
