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Alternative Market Briefing

Opalesque Exclusive - Investors continue to allocate to private equity despite headwinds

Tuesday, November 29, 2022

Bailey McCann, Opalesque New York:

Despite market headwinds and broad uncertainty, investors are still increasing their allocations to private equity, according to new survey data from Swiss private equity firm Montana Capital Partners.

The survey includes responses from more than 60 family offices and institutional investors worldwide.

The survey finds that 71% of family offices and foundations and 33% of institutional investors now allocate 15% or more of their portfolio to private equity, a significant increase compared to 49% and 21%, respectively, in 2021.

Increased allocations are a result of the strong performance of the asset class and a fundraising environment that has seen GPs come back to market faster than ever and forced investors to accelerate their deployment, the firm says. Despite some portfolios running into the denominator effect as a result of selloffs in other asset classes, the firm anticipates that allocations will continue as investors look for consistent sources of investment return.

According to survey data, secondaries is a key long-term strategic preference of investors behind mid-market buyouts. Investors are specifically interested in complex secondaries and fund portfolio acquisitions. With a quarter of institutional investors expecting to sell positions in the next 12 months, secondaries investors can expect to see attractive investment opportunities in the near term, the report said.

"Secondaries are expected to perfor......................

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