Practical Applications of Private Markets—From Alternative to Mainstream: Evolution during the Past 30 Years and Key Trends and Challenges for the Decades to Come

Erik Knutzen
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Abstract

In Private Markets—From Alternative to Mainstream: Evolution during the Past 30 Years and Key Trends and Challenges for the Decades to Come, from the June 2022 special 30th anniversary issue of The Journal of Investing, Erik Knutzen (of Neuberger Berman) explains the dramatic growth and evolution of private markets since the 1980s. Back then, private equity (PE) was a small and exotic sector for only the most sophisticated investors. In the decades since, however, PE has grown into a multitrillion-dollar global industry that owns thousands of companies, while the number of publicly listed companies has dropped to about half of what it was in the 1990s. The author explains the key drivers of these events: regulatory changes, the evolution of credit markets, broader acceptance of PE among institutional investors, PE’s relatively high returns, growth and innovation in the PE sector, PE’s diversification and return-smoothing benefits, PE’s better alignment for long-term investors, and the fact that private markets are becoming more liquid. Private markets likely will continue to grow due to PE’s higher expected returns, institutional investors’ need to close the “return gap” between expected and target returns, and the fact that PE is increasingly grouped with traditional assets in asset allocation frameworks.
私人市场的实际应用——从另类到主流:过去30年的演变以及未来几十年的主要趋势和挑战
在《私募市场——从另类到主流:过去30年的演变和未来几十年的主要趋势和挑战》一书中,来自Neuberger Berman的Erik Knutzen解释了自20世纪80年代以来私募市场的急剧增长和演变。当时,私募股权(PE)还是一个只有最老练的投资者才会涉足的小而新奇的领域。然而,在此后的几十年里,私募股权已发展成为一个规模达数万亿美元的全球产业,拥有数千家公司,而上市公司的数量已降至上世纪90年代的一半左右。作者解释了这些事件的关键驱动因素:监管变化、信贷市场的演变、机构投资者对私募股权的广泛接受、私募股权相对较高的回报、私募股权行业的增长和创新、私募股权的多元化和回报平滑效益、私募股权与长期投资者的更好结合,以及私募市场流动性越来越强的事实。私募股权市场可能会继续增长,因为私募股权的预期回报更高,机构投资者需要缩小预期回报和目标回报之间的“回报差距”,以及私募股权在资产配置框架中越来越多地与传统资产组合在一起。
本文章由计算机程序翻译,如有差异,请以英文原文为准。
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