Some 86% of private equity firms expect alternative investments to dominate retail portfolios within the next five years, according to a new report based on a study commissioned by global asset servicing provider Apex Group.
The study, titled “Leading the Shift: Transforming Private Markets in a Retail-Driven Landscape”, was conducted by Global Custodian and surveyed 117 senior executives from global asset management firms, including C-suite leaders, portfolio managers, and finance directors. The findings underscore the surging interest in private equity and real estate among retail investors and the pivotal role of technology in facilitating broader market access.
Some 97% of asset managers report strong or moderate retail interest in private markets, with private equity (67%) and real estate (55%) leading the charge.
Nearly 70% of asset managers identify digital platforms as key to enabling retail participation, while 58% see blockchain and tokenisation as transformational for private market distribution.
Regulatory restrictions (59%) and liquidity concerns (43%), meanwhile, remain the biggest hurdles preventing broader retail access.
The report also reveals that 76% of firms have embraced outsourcing, citing cost efficiency (70%) and time savings (71%) as the primary benefits. Meanwhile, 65% have engaged in lift-outs, transferring in-house functions to third-party providers to leverage better technology and specialised talent.
The research highlights a fundamental shift in private markets, with retail investors playing an increasingly influential role in shaping investment strategies.
Peter Hughes, founder and CEO of Apex Group, emphasised the significance of this transformation: “These findings underscore the major shift we’re witnessing in private markets, as retail investors are now driving significant demand across alternative asset classes such as private equity and real estate,” he said.
“Apex Group is at the forefront of this trend, helping alternative managers and retail investors interact digitally using innovative solutions that are seamlessly linked to traditional asset servicing.”
