PE stuck in a holding pattern
Hot economic growth and consumer spending have combined with cooler inflation to craft a healthy US economy. But the higher-for-longer timeline for interest rates and a disconnect on valuations between buyers and sellers create a more lukewarm environment for private equity.
While PE firms dealt with those issues, another threat emerged to the industry’s growth: higher yields on Treasury notes. Long-term bonds could present competition for PE as institutional investors allocate capital to less risky asset classes.
The latest report in our data-rich Quantitative Perspectives series, The Waiting Game, presents the case for long-term challenges in PE.
Table of contents
| Introduction | 2 |
| The economic environment | 3 |
| Shifting bond market dynamics and considerations for allocators | 13 |
| Challenges to the buyout model | 22 |
| The exit drought worsens | 32 |
