Why private markets have historically outperformed public markets
Key messages
- On average, private markets have outperformed public markets.
- This excess return generally comes from the illiquidity and complexity premiums.
- Adding private assets to a portfolio can improve return potential, increase diversification and aims to enhance the portfolio’s overall risk profile.
Private assets have become an increasingly important part of building resilient portfolios as the asset class can be a source of additional diversification and growth potential. Compare the performance characteristics of private and public investments and see why more investors are paying closer attention to private market opportunities.
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