Private credit, secondaries solidify position as “pillar” of alternatives

Private credit and secondaries have continued to earn their stripes as ‘pillars’ of alternative investing, as exposure to the assets is set to either remain or increase in the majority of investors’ portfolios according to Coller Capital’s latest Global Private Capital Barometer.

Now celebrating 20 years, the 41st edition found that of the 110 private market investors surveyed from 12 September to 30 October last year, who manage a combined $US1.9 trillion in global assets, 37 per cent planned to increase their allocation to private credit and 47 per cent intended to keep the same allocation.

Only 16 per cent said they would look to lower their private credit investments. Private equity and infrastructure were not far behind, with 34 per cent and 33 per cent of respondents respectively indicating they were looking to expand their allocations.

According to the same Winter 2024/25 Barometer, close to half of Limited Partners (LPs) surveyed indicated that secondaries were now a “core pillar” of their alternative assets strategy.

“The Barometer also identified that about two-thirds of investors were expecting to focus their credit programs and concentrate on a smaller number of credit managers in the next two to three years,” Michael Schad, Partner and Head of Coller Credit, said.

“At the same time, a similar proportion of respondents are likely to back a more limited number of credit strategies. Given the abundance of options and continued diversification, it is likely that many have gained ample experience across the strategy, identified their ideal niches, and are content to channel their investment capabilities within these specific areas.

“North American LPs exhibited the strongest inclination towards a more focused group of credit managers, whilst investors from the Rest of the world showed the greatest tilt towards backing a more limited range of credit strategies.”