An increasingly varied universe, private markets may offer interesting entry points for investors amid volatility in public markets and demand for capital. We highlight three areas to consider.


1. Private credit: evaluate opportunities in two areas


European mid-cap lending:

– With balance sheets under pressure, banks could prioritise lending to investment-grade companies. That move could create potential opportunities for private markets investors in other areas of the market.

– Higher returns in lending to lower-rated companies may provide more cushion to absorb potential losses in an economic slowdown – and mean investors are well positioned for when conditions improve.

Trade finance:

– A short-term, semi-liquid asset class with limited risk of losses from non-payment or changes in interest rates, trade finance can help investors build portfolio returns.

– Investors may be able to play a part in helping banks meet strong demand for trade finance. And it can serve as an asset class to search for opportunities while waiting for longer-dated credit markets to reset.

2. Partnerships and secondary markets: more potential deals



– In a tougher market for fundraising, we expect private equity firms (also called general partners or GPs) to seek out partners for deals, a process known as coinvestment.

– Large and trusted partners are expected to be particularly sought after to help fund deals as
distribution becomes more challenging in softer markets.

Secondary market deals:

– Another potential opportunity for investors are GP-led secondary market deals and continuation funds, set up to take on the portfolio investments of a fund close to the end of its lifespan.

– Large partners are expected to be in demand to help fund deals in a market that has swelled by double-digit rates over the past 20 years to an estimated USD 134 billion in 2021.1


3. Infrastructure: two factors to think about



– We see a huge need for capital to fund both the transition to more sustainable sources and to ensure the security of future energy supplies.

– The scale of investment required is vast. Globally, cumulative investment of USD of 35 trillion is needed by 2030 to help fund the energy transition,1 with a focus on efficiency, electrification, grid expansion and flexibility.


– Infrastructure assets often have features and contractual protections to enable investors to
navigate periods of high inflation.

– Investment opportunities may arise as companies seek to offload assets as inflation squeezes profit margins. We see these openings emerging across equity, high-yield and investment-grade credit.
1. Investment Needs of USD 35 trillion by 2030 for Successful Energy Transition ( International Renewable Energy Agency, 28 March 2023
Learn more: 2023 outlook: private markets at a crossroads | Allianz Global Investors (
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