News Digest: Alternative investments markets to double by 2027
October 3, 2022
The global markets for alternative investments will touch $18.3 trillion over the next five years, from its current levels of $9.3 trillion. A biennial report by research and analytics firm Preqin says demand for private capital remains resilient in spite of a challenging macroeconomic outlook across several geographies.
The demand remains strong due to investors seeking alternative sources of return in an uncertain economic environment, says the report, which also predicts a slowdown in the alternative investment market’s compound annual growth rates. Between 2015 to 2021, the market grew at 14.% annually, which could drop to 11.9% over 2022-2027.
If one were to include hedge funds alongside private equity, real estate and other alternative asset classes, the global markets could reach $22.3 trillion by end-2027, up from $13.7 trillion at the end of 2021. This indicates that the hedge funds are somewhat of a drag on the overall growth.