The 'middle-market effect' is a premium of returns above smaller- and larger-sized investments that is persistent and accessible with select investment strategies and managers. Part of the reason for this is supply and demand, preferences of large investors, combined with growth opportunity that provides higher returns than the smallest- and largest-scale investments.
We provide some detail on the outlook and opportunities across the real estate, private equity/venture capital, private credit, infrastructure and agriculture asset classes.
The first half of the year saw some dislocations in pricing which began to close with some vendors and buyers of private market assets bridging expectations and becoming more willing to complete deal transactions. As a consequence, transaction activity has picked up amongst private market buyers while public market activity shows tentative signs of recovery from a recent pickup in non-mining initial public offerings.
Private Equity is the term used for investing in companies that are not publicly listed. Private Equity fund managers raise capital to buy into private companies, which they then manage and overhaul to earn a profit once the business is sold again years later.
Alternative investments are asset classes that aren’t stocks, bonds or cash. They are most often also referred to as private market or unlisted assets although some may be derived from listed markets.
An allocation to private markets can not only enhance total returns but also smooth the overall investment path by providing additional sources of returns. Partners Private continue to look for attractive investment opportunities with attractive risk / return characteristics. Below we provide some more detail on the outlook and opportunities across some of the private asset classes we cover.