U.S. Private Markets 2025
Incorporating Private Market Investments into Model Portfolios
Drive Demand in New Channels
- Discover the latest trends in retail and institutional alternative investment market sizing, investment strategy, size, vehicle, distribution, and new product innovation
- Track the growth of major alternative investment platforms
- Take a deep dive into rollout and advisor use of enhanced liquidity offerings
- Understand the potential for use of alternatives via the retirement channel
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Summary
Examine the retail and institutional alternative investment landscape, including market sizing, investment strategy, size, vehicle, distribution, and new product innovation. This report includes sizing and coverage of the widest variety of products used to access alternative investments, from daily liquidity offerings to convergence zone products, as well as illiquid private equity and hedge fund products. This year’s report will continue to focus on the democratization of alternatives theme as both traditional and alternative investment managers seek to provide such allocations to retail clients and consider options including internal development acquisition of capabilities.
A Note from the Author
Private Markets Retail Assets to Reach $3.7 Trillion Through 2029
Daniil Shapiro, CFA
Director
Bio →
Daniil Shapiro, CFA
Director
Daniil is a Director in Cerulli’s Product Development practice, which focuses on trends related to asset managers’ product strategy, development, and management functions. This broadly includes assessing the opportunity for product line expansion, evaluating emerging product trends, assessing optimal pricing strategy, and understanding distribution and product positioning for investment products across retail and institutional channels.
Relying on industry surveys and interviews with a wide variety of industry stakeholders, Daniil seeks to deliver insights through Cerulli’s published research, consulting engagements, and presentations.
Full biography here.
Retail assets in private capital strategies are growing—rapidly. Cerulli estimates that U.S. financial advisors currently allocate $1.9 trillion to less than fully liquid private market strategies and projects this portion to grow to $3.7 trillion through 2029—representing a $1.7 trillion opportunity over the next several years.
How will asset and wealth managers support the next leg of growth? Our research shows that many will increasingly look to asset allocation models to mainstream product and simplify access. Here are the top-three avenues our research identifies for model inclusion:
- Models With Alternatives: Standard asset allocation models that incorporate a private market sleeve (e.g., as a component of a unified managed account (UMA))
- Models of Alternatives: Mainly paper models that exclusively consist of private market solutions and suggest rebalancing
- Model-Adjacent Solutions: Products that are model-like, including single-ticket solutions (e.g., multi-manager and multi-strategy funds)
And here’s what asset managers believe are their best opportunities:
- Almost half (48%) report multi-manager product as a best opportunity for inclusion
- 44% believe that inclusion in paper models to wealth managers is the best opportunity
- 41% believe that inclusion in a UMA program (including via a turnkey asset management program, or TAMP) represents the best opportunity for inclusion
Continue to explore this theme and evaluate the defined contribution (DC) market opportunity and associated challenges, including key remediations for operational challenges and the education effort required to support intermediary and plan sponsor adoption of the strategies.
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Methodology
Each report is lead authored by a senior Cerulli analyst with significant industry experience. The report incorporates qualitative and quantitative inputs, based on Cerulli’s proprietary research process. For more on our research process, click here.
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