Re:PPCC: Pisitófilos Creditófagos. Otoño 2025

[tomasjos]

¿Órdago de Junts?

Carles Puigdemont se abre a una moción instrumental con candidato pactado si Sánchez no convoca elecciones https://share.google/3Y1nsEsssGweDvTDa

[El_empecinado]

La liquidez...

https://www.ft.com/content/69197739-f287-48e8-84d7-01877d98b1cd

Asset managers trim real estate holdings amid market downturn

Retreat comes as sluggish sales and high interest rates weigh on cash flows from property funds


Sluggish property transactions and high interest rates have left real estate among the worst-performing asset classes for institutional investors © Kylie Cooper/Reuters

Institutional investors have trimmed target allocations to real estate for the first time in 13 years as they unload property fund stakes at steep discounts.

A survey* of 166 institutional investors, ranging from pension funds to university endowments, released by Cornell University and capital advisory firm Hodes Weill & Associates found target allocation for the asset class dropped to 10.7 per cent this year, the first decline since the study began in 2013.

A previous survey by financial advisory group Campbell Lutyens found that institutional investors sold real estate fund stakes at an average discount of 34 per cent to net asset value in the first half of this year, up from 19 per cent a year earlier.

The retreat and widening discounts in the secondary market come as sluggish property transactions and high interest rates weigh on cash flows from real estate portfolios, leaving the sector among the worst-performing asset classes for institutional investors.

“Institutions are not abandoning their allocation to real estate,” said Doug Weill, co-managing partner of advisory firm Hodes Weill, at a webinar on Tuesday, “but there is clearly a little bit of a pullback”.

While real estate has historically served as a stable source of income and a hedge against inflation in institutional portfolios, the asset class has in recent years struggled with muted deal activity, softening valuations and higher office vacancy rates.

The higher for longer interest rate environment has damped residential and commercial property sales, while remote and hybrid working has driven office vacancies to record highs, squeezing deal activity and rental income.

Grant Walker, managing director for real estate at the $200bn Teacher Retirement System of Texas, which has 14 per cent of its portfolio in the asset class, told a board meeting last month that the fund’s property holdings lost 2.6 per cent in the second quarter — a big drag on overall returns — as the sector “continues to be challenged by higher interest rates and lower valuations”.

The Hodes Weill study found that respondents gained 1.4 per cent on their real estate investments last year after losing 1.4 per cent in 2023, well below their target return of 8.4 per cent. Two-fifths of respondents said they were under-allocated to the sector relative to their targets this year.

Real estate funds have been struggling to generate the cash flow needed to pay investors. Their distribution rate — cash returned to investors as a share of assets — has steadily declined over the past decade, reaching a record low of 6.6 per cent in the second quarter of this year, according to MSCI.

“The bottom line is [that] closed real estate fund distributions are at a 10-year low,” said Jamie Sunday, co-head of real estate secondaries at Ares Management. “That is creating pressure across a whole host of investor types.”

With little hope of a quick turnaround, institutional investors have been tapping the secondary market to raise liquidity for new investments. An executive at a university endowment, who spoke on condition of anonymity to discuss a private transaction, said the fund sold real estate stakes this year and redeployed the capital into data centres.

“There is a big need to rebalance our portfolio and create liquidity,” the person said.

A significant obstacle for asset managers looking to sell real estate stakes on the secondary market is the widening discount they must accept.

Asset managers said they agreed to steep price cuts amid fading confidence in a near-term market rebound, particularly in the office sector, which has been hit hardest by the downturn.

“The market is telling me that these values are not coming back in the short term,” said an executive at a public pension plan that sold real estate stakes at a “significant” discount this year, who did not want to be publicly identified discussing a loss for the fund. “It’s time to cut my losses and exit the investment as quickly as I can.”

Sunday of Ares said a growing number of limited partners were “getting comfortable with the higher pricing discounts as an increasing number of investors are transacting in the secondary market”.

*https://www.hodesweill.com/real-estate-allocations-monitor

Y sin embargo, SRS, DRV o REK, 3 ETF inversos REIT de USA, haciendo suelo plano aburreovejas. Se lo están perdiendo o la realidad no es tan mala como la que presenta artículo?

Este es un apalancado x3, pero los 3 fondos lucen el mismo pelaje:

Direxion Daily Real Estate Bear 3X Shares (DRV) cotiza a $23,250 (+0,26%)

http://es.investing.com/etfs/direxion-daily-real-estate-bear-3x?utm_source=investing_app&utm_medium=share_link&utm_campaign=share_instrument

[Cadavre Exquis]

Todos somos inquilinos, y cuanto antes nos enteremos, mejor
La subida del precio de la vivienda y del inmobiliario explica el encarecimiento de la vida en general: es la razón por la que hoy un café cuesta tres euros en muchas ciudades de España y por la que una consulta del psicólogo cuesta 100. Cuando sube la vivienda, lo pagamos todos

María Álvarez · 2025.10.22

Manifestación en Zaragoza contra el excesivo precio de la vivienda en abril de 2025 Javier Belver/EFE

 En el Ministerio de Vivienda comenzaron esta semana echándose unas risas a costa de las personas que se suponía que tenían que proteger y la van a terminar rectificando y retirando una campaña de muchos cientos de miles de euros. Bienvenida sea la corrección, en un momento en el que parece que reconocer que uno se ha equivocado es un crimen. Ojalá venga seguida, en los próximos días, de una disculpa.

Si podemos aprender algo de este episodio, es que parece que todavía no hemos terminado de entender cuál es, en realidad, el problema de la vivienda. Unos piensan, como ironizaba el desgraciado anuncio del ministerio, que se trata de un asunto de los jóvenes, o de los millennials. Otros, los críticos con ese enfoque, dicen que no, que es un problema de los pobres, o de los que no van a heredar. Ni lo uno, ni lo otro. La realidad es que cuando sube la vivienda, lo pagamos todos.

¿O de dónde crees que sale el dinero del alquiler del camarero que te da de desayunar por las mañanas? ¿Quién crees que paga la hipoteca de tu dentista? ¿Confías en que el dueño del supermercado, si tiene que pagar el doble por los locales, se lo va a descontar de su cuenta de resultados?

La subida del precio de la vivienda y del inmobiliario explica el encarecimiento de la vida en general: es la razón por la que hoy un café cuesta tres euros en muchas ciudades de España y por la que una consulta del psicólogo cuesta 100. Seguramente también es la razón por la que las universidades públicas (y los hospitales, y los colegios) tienen hoy más costes de personal que hace 15 años, pese a tener, en muchos casos, menos alumnos: cuando sube el precio de la vivienda, sube el coste de los servicios públicos.

En última instancia, es ese encarecimiento el que pone en riesgo las pensiones. A una economía que no crece (per cápita) le estamos pidiendo que se haga cargo de unos costes inmobiliarios disparados de los trabajadores y de los pensionistas al mismo tiempo.

Se entiende mucho mejor si pensamos en una partida de Monopoly, porque es lo que es. Hay una generación que empezó (empezamos) a jugar cuando ya estaban todas las propiedades repartidas. Esa gente es la que está en primera línea y sufre más este problema, porque tiene que pagar en todas las casillas del tablero.

Pero parece que no nos damos cuenta de que quien tiene una propiedad ¡también tiene que pagar en todas las demás casillas!

Y lo que es más grave: a medida que pasa el tiempo, cuantas más vueltas le damos al tablero, más propiedades tienen que vender los propietarios de una casilla para pagar lo que gastan en todas las demás: en cuidados, en dejarles a los hijos o en vivir. Mientras, la propiedad se va concentrando cada vez en menos manos porque en el Monopoly, como sabe cualquiera, siempre acaba quedando solo uno.

La razón por la que tenemos una percepción tan acuciante de escasez y de encarecimiento de la vida, es ésta: no hay subida de salarios que pueda combatir la especulación inmobiliaria y la facilidad que le hemos otorgado para extraer rentas del sistema y llevárselas, bien a seguir especulando, bien fuera del país. Al contrario, cuanto más suben los salarios, más renta se llevan los especuladores. Por eso no servirá que el precio de los alquileres se modere, o que se construya algo de vivienda pública, si eso justifica que el número de arrendatarios siga subiendo.

Si no se observa ya con una crudeza lacerante, es porque no hace mucho que empezamos a jugar. Esta tendencia al rentismo extractivo se ha acelerado en la última década, más aun en los últimos cinco años, y todavía hay gente que no se ha dado cuenta de que, a cambio de que su única propiedad se revalorice, les toca pagar el doble o el triple en todas las demás.

Todos somos inquilinos. Tú, también. Y el problema real que esconde el encarecimiento de la vivienda no tiene que ver ni con los jóvenes, ni con la comodidad de compartir piso, ni siquiera con la desigualdad, sino con el modelo de sociedad que queremos, con el juego al que estamos jugando.

 A ver si el próximo anuncio va sobre esto.

Saludos.

[sargento.algodon]

Una reflexión que llevo rumiando desde 2008. El sector inmobiliario, esa remora de la economía, es también un sector necesario. Necesitamos que se construyan casas, se reformen las que hay y se alquilen pisos. Lo discutible es para qué y en que medida.
Como soy un poco anarquista y fiscalista, tengo el alma partida. Como aquí se dice, el mercado inmobiliario no son dos curvitas (si es que una es una curva, yo creo que tiende más a la recta...) y la intervención de ese Leviatan que es el Estado (o la comunidad autonoma cuando no la gobierna el PSOE) es necesaria, por mucho que obligue a mi yo anarquista a madurar y conllevar esa intromisión de lo "público", que al final son los intereses de los partidos politicoas.

https://www.eldebate.com/economia/20240927/psoe-partido-diputados-rentistas-junts-bildu_230984.html

Muchos de ustedes quieren utilizar los impuestos como palanca de intervención. Como fiscalista, aunque pueda suponer más trabajo para poder pagar mi confiscatorio alquiler, no me parece bien. Y pienso que en realidad la intervención pública debiera ser o a través de promociones públicas, lo cual en este país es casí una oda a la ineficiencia y la corrupción o a través de otra solución que se nos da muy bien pero tiene muy mala prensa:la regulación exasperante. Para iniciar cualquier actividad económica en este país los tramites a realizar son larogos y prolijos, requieren asistencia de profesionales y están sujetos a supervisiones que, aún requiriendo más inversión en personal y medios, suelen funcionar bastante. Apliquemos lo mismo al mercado del alquiler. En estos momentos, para alquilar un piso lo que precisa cualquier propietario es el acceso a internet y una camara de fotos o pagar una ridicula (en comparación con otras inversiones) mensualidad de sus futuros ingresos a una agencia inmobiliaria. No hay altas en registros, licencias de actividad, permisos y controles autonómicos o locales. Es el sector con menos barreras de entrada de toda la economía europea.
Un simple cambio de la Ley de Arrendamientos Urbanos que exigiera examenes de capacitación previos al propietario,  altas y licencias de actividad, requisitos más técnicos de los que se piden actualmente tanto al inmueble a alquilar como a los contratos firmados y los medios de cobro, incluso la exigencia de un número mínimo de inmuebles para poder realizar esta actividad iba a suponer una modificación tan grande en el sector que el movimiento que se produciría podría suponer:
 la salida de mucho "inversor" individual que no podrá cumplir con los requisitos y normativas, con el aumento de ventas a la baja de esos inmuebles,
- la entrada de gestores profesionales que harían que el mercado inmobliario fuera eso, un mercado que tiende a la eficiencia.
- concentración de propiedad inmobilaria, lo cual supone menores factores políticos en la toma de decisiones.

Se me hace duro proponer estas cosas, pero es lo que veo.

También veo que lo de construir más no es una solución actualmente. Si fuera cierto eso de la falta de oferta, habría movimientos para construir y llenar ese hueco y no los haý. Porque no hay financiacion (las entidades bancarias no dan credito promotor porque no ven el futuro en esa solución). Sobre los costes de construcción o del suelo, pueden ser altos, pero, si nos creemos las noticias de subidas continuadas en los precios en los próximos años, habriamos llegado ya a un umbral en que sería rentable construir. Y como nadie lo hace, es que las subidas futuras no se las creen.

[sargento.algodon]

No soy experto, pero de mis clases en Deusto me quede con una fascinación por Weber y su aproximación a la burocracia y a la institución. Puede que lo entendiera mal. Por eso, cuando leo esto, me rasco la cabeza debajo de la boina.

https://www.eldebate.com/economia/20240927/psoe-partido-diputados-rentistas-junts-bildu_230984.html

El PSOE es el partido con más diputados rentistas tras Junts y Bildu
Hasta 23 de los 120 diputados socialistas declaran algún ingreso por alquiler

​La ministra de Vivienda, que posee siete inmuebles, pide solidaridad a los caseros para bajar los alquileres
Redacción El DebateEl Debate
27 sep. 2024 - 11:10 Act. 27 sep. 2024 - 17:04

Hasta 23 de los 120 diputados socialista declaran ingresos por alquileres, según un análisis de las declaraciones de bienes de los diputados realizado por el periódico Público. Esto convierte al PSOE al partido mayoritario con más diputados rentistas entre sus filas en términos porcentuales.

En términos porcentuales, el 19,33 % de los socialistas declaran alguna propiedad en alquiler, por delante de PP (18,38 %), ERC (16,67 %) o Vox (15,15 %). Solo lo superan, en términos porcentuales, Junts (33,33 %), que solo cuenta con 7 diputados, Bildu (33,33 %), con seis diputados y UPN, cuyo único diputado declara tener inmuebles en alquiler. Por el contrario, ninguno de los cinco diputados del PNV tiene inmuebles en alquiler.

De media, el 17,34 % de los parlamentarios del Congreso cobra algún tipo de renta por el alquiler, siempre según el mencionado análisis del periódico de izquierdas.

Ministra rentista

La propia ministra de Vivienda, Isabel Rodríguez, posee siete inmuebles. Como ya contó El Debate, es titular de tres viviendas en Ciudad Real, una de ellas al 100 % y otras dos al 50 %. La primera de ellas fue adquirida en 2004, la segunda en 2011 y la tercera en 2018.

Además la ministra, de 42 años, es titular del 50 % de dos plazas de aparcamiento y dos trasteros. A cuenta de estos inmuebles Rodríguez percibe una renta de 5.130 euros, que suma a los 6.617,93 euros al mes que percibe, en 12 pagas, como ministra.

Esta semana, Rodríguez ha vuelto a reclamar solidarida a los caseros ante el alza de los alquileres causado, entre otros factores, por los efectos de la Ley de Vivienda del actual Ejecutivo. En una entrevista en Onda Madrid Rodríguez ha reclamado a los pequeños propietarios, «que son mayoría» que «se hagan cargo de esta causa, de esta necesidad social y que valoremos esas rentabilidades en términos sociales, que esos precios estén de acuerdo con las capacidades de los españoles y españolas».

[sargento.algodon]

Jo, la casa de mi padre. Tengo que subir al pueblo a dar una última limpia, quitar las mosquiteras del verano, cerrar el agua y la chimenea para que no mueran pajaros atrapados en ella, recoger alguna nuez, desbrozar las zarzas y rehacer el muro caído en la entrada.

NIRE AITAREN ETXEA

Nire aitaren etxea
defendituko dut.
Otsoen kontra,
sikatearen kontra,
lukurreiaren kontra,
justiziaren kontra,
defenditu
eginen dut
nire aitaren etxea.
Galduko ditut
aziendak,
soloak,
pinudiak;
galduko ditut
korrituak,
errenteak,
interesak,
baina nire aitaren etxea defendituko dut.
Harmak kenduko dizkidate,
eta eskuarekin defendituko dut
nire aitaren etxea;
eskuak ebakiko dizkidate,
eta besoarekin defendituko dut
nire aitaren etxea;
besorik gabe,
sorbaldik gabe,
bularrik gabe
utziko naute,
eta arimarekin defendituko dut
nire aitaren etxea.
Ni hilen naiz,
nire arima galduko da,
nire askazia galduko da,
baina nire aitaren etxeak
iraunen du
zutik.


De Harri eta Herri, 1963

LA CASA DE MI PADRE

Defenderé
la casa de mi padre.
Contra los lobos,
contra la sequía,
contra la usura,
contra la justicia,
defenderé
la casa
de mi padre.
Perderé
los ganados,
los huertos,
los pinares;
perderé
los intereses,
las rentas,
los dividendos,
pero defenderé la casa de mi padre.
Me quitarán las armas
y con las manos defenderé
la casa de mi padre;
me cortarán las manos
y con los brazos defenderé
la casa de mi padre;
me dejarán
sin brazos,
sin hombros
y sin pechos,
y con el alma defenderé
la casa de mi padre.
Me moriré,
se perderá mi alma,
se perderá mi prole,
pero la casa de mi padre
seguirá
en pie.

De Piedra y pueblo, 1963

[asustadísimos]

[No estás solo ante la muerte. La muerte viene un hoy para siempre.  Pero solo mueren el cuerpo y su animación, es decir, el alma, la mente, la relación contigo mismo. Por contra, el espíritu es inmortal y compartido. La vivienda del padre es cuerpo y alma. Su casa es el espíritu. Gracias, Padre por la creación. 'NIRE AITAREN ETXEA', de Gabriel Aresti, es una alegoría.]

[asustadísimos]

[En un sistema que se dice llamar capitalista, es increíble que no se considere que la persona física que exprime inquilinos realiza una actividad económica, sino que obtiene un rendimiento de un hipotético 'capital inmobiliario'; cuando además todo el mundo sabe los inmuebles no rentan por sí mismos nada (antes al contrario, son una carga) y que lo que renta son los negocios que montas con ellos.

No obstante, más increíble aún es que se desprecie al dinero. Ayer mismo me dijeron: «El dinero no vale nada, lo que vale son las cosas que puedes comprar con él». Y yo contesté: «¿Y si te equivocas comprando?».

Pero lo que riza el rizo es que, en el sistema capitalista, se desprecie al Capital mismo (Activo menos Pasivo), y prolifere la adquisición de activos ficticios y el sobrendeudamiento; y que acabe habiendo más y mejor Capital en los países comunistas, como la República Popular China.]

[CHOSEN]

Otra noticia que abunda en el argumento de que pisos no faltan, sino que la oferta está retenida. Asustadísimos tiene razón otra vez. Y yo sigo viéndolo como un desafío al Estado

Es el Estado el que retiene las viviendas de la SAREB.

[tomasjos]

Otra noticia que abunda en el argumento de que pisos no faltan, sino que la oferta está retenida. Asustadísimos tiene razón otra vez. Y yo sigo viéndolo como un desafío al Estado

Es el Estado el que retiene las viviendas de la SAREB.

Chosen, esas pasan ahora a la empresa pública de alquiler.con lo que no están retenidas. El problema es el Propietariado.

[Fomento Cemento]

Otra noticia que abunda en el argumento de que pisos no faltan, sino que la oferta está retenida. Asustadísimos tiene razón otra vez. Y yo sigo viéndolo como un desafío al Estado

Es el Estado el que retiene las viviendas de la SAREB.

Chosen, esas pasan ahora a la empresa pública de alquiler.con lo que no están retenidas. El problema es el Propietariado.

Ahorita mismo, sí. 15 años tarde y cuando no queda más que morralla.

[Overlord]

Hace años hice trabajos e informes de ocupación para algunos servicers inmobiliarios de la banca y fondos, cuando aún se estaban enterando de cuánta y de qué color era la mierda que tenían entre manos. Las más "normales", en el mejor de los casos, eran promociones enteras mal acabadas deprisa y corriendo, en las que en la mitad de los alquileres los inquilinos no pagaban.

Las más presentables se intentaban adecentar y vender; algunas, incluso con ocupas y por lotes. Muchas estaban en zonas y barrios donde nadie quiere vivir, a no ser que no te quede otra. En muchas, daba respeto simplemente entrar en la calle. En una promoción enorme me tocó ir acompañado por seguridad privada. Hace ya diez años de esto, así que imagino que la mayoría se las habrán quitado de encima.

Si eso era lo más rescatable, no quiero ni imaginar la clase de basura que debe tener la SAREB si todavía no se han podido deshacer de ellas

Según tengo entendido hay unas 40.000 viviendas del SAREB cedidas para alquiler social al SEPES, pero solo 13.000 son inmediatamente habitables y el resto necesitarán o reforma o rehabilitación integral.
Por lo menos el suelo que tengan está ahí disponible , aunque habría que ver donde

[senslev]

[Derby]

https://www.ft.com/content/b034e81d-04e5-480e-8688-68cd6a8667ef

Why everyone is trying to sell you private assets right now

Wealth managers are keen to promote semi-liquid funds to a new group of clients


© Amy Anderson

A battle is on in Europe for the savings of wealthy investors.

Asset managers see a golden opportunity to sell private assets — equity, credit and infrastructure — to clients previously accustomed to investing only in publicly traded stocks and bonds, through new types of funds.

The super-rich — at least those with more than $50mn to invest — may well hold upwards of a quarter of their portfolios in private assets. But those with less have found it difficult to meet minimum investment thresholds. Until now.

In Europe, recent open-ended funds have evolved into the Eltif (European Long-Term Investment Fund), designed to channel the capital of individuals towards long-term projects and companies. In the UK, these are known as LTAFs (long-term asset funds). Both are regulated and are considered part of the “democratisation” of private assets.

These funds have a semi-liquid structure, one that usually allows monthly inflows but only quarterly, at best, redemptions. For the latest version of Eltifs there are no minimum investment thresholds, while UK LTAFs have a £10,000 minimum.

Eltifs in wealth portfolios had expanded to €25bn by June this year, up 56 per cent since December 2024. The UK equivalent, LTAFs, have grown by 46 per cent to €8bn over the same time period, according to data from Amundi.

At the same time, double-digit returns from private investments have created some of the world’s most successful private companies, such as OpenAI and SpaceX. It’s little wonder that ordinary investors are having their heads turned.

But being big doesn’t necessarily make private groups safe investments. The rapid collapse this month of highly leveraged US auto parts group First Brands, with some $12bn in debt, sent shivers through the leveraged loan and private credit markets.

This week, Bank of England governor Andrew Bailey drew parallels with practices before the 2008 financial crisis, telling the House of Lords’ financial services regulation committee that “alarm bells” are ringing over risky lending in the private credit markets.

Some in the industry believe the rosiest period may have passed for private assets.

“Recommending private assets now is like showing up Saturday for last Friday’s train,” quips the head of a multibillion-dollar family office based in Chicago. “The rush to open [up] retail to the [private asset] space is a harbinger of a market top.”

Speaking at an FT conference this month, Marc Nachmann, head of Goldman Sachs’ money management business, said the rush of retail money into private assets is pressuring fund managers to deploy capital quickly, adding to the risk of buying bad assets.

Still, many wealth managers believe private assets provide not only good returns over a long period, but can diversify portfolios, reducing risk without compromising on performance. The fact that these funds also tend to have much higher fees, perhaps double those of standard publicly listed funds are a happy coincidence, wealth managers might say.

“It’s [definitely] as important to the wealth management industry as it is to the alternative asset managers,” believes Lubasha Heredia, a partner at financial consultants Oliver Wyman. “It’s a higher margin product . . . something that can help them justify their fees.”

The question is, are these new products appropriate for more mainstream investors who may not fully understand the risks?

In many respects, retail investors are filling the shoes of those who have already bolted for the exit. Private equity funds in particular have sought new sources of capital as demand from their institutional clients has waned in recent years.

Part of this has been due to the inability to pay enough distributions to these limited partner clients. A drop in IPO and deal activity between 2021 and 2024 particularly in the US caused a bottleneck of capital.

In the year to June 2025, private equity funds raised $592bn, the lowest amount in seven years according to a recent Financial Times article.



Stonehage Fleming manages $28bn in assets. Its head of private capital, Matthew Powley, has plenty of visiting fund marketers pitching these products. “It is getting busier, yes. It used to be a more exclusive business . . . With so much capital targeting the space, it creates a lot of noise. It makes our job harder and thus more important.”

The potential market for these vehicles is substantial: aimed at investors with anywhere from $300,000 to $50mn to invest. Consultancy Oliver Wyman predicts that, by 2029, this group could quadruple its private asset holdings to $2.2tn.

Wealth advisers believe that a big opportunity exists for their clients, many of whom could not benefit in the past as they had less capital to commit.

Some regard private assets as a useful way to diversify your portfolio, if you’re investing for the long-term. “Correlations [with public markets] are low,” says Maya Bhandari, who oversees Neuberger Berman’s multi-asset investment in Emea.

Others see them as a way to tap into some alpha — investment returns that are better than expected returns, given its risk level.

“There are fewer companies in the public space. If you’re a wealthy investor without private exposure you’re missing out on [an] opportunity,” says Kristin Olson, global head of alternatives for Goldman Sachs’ wealth business.

For some investors, attractive returns have certainly brought on a sense of Fomo. Over 20 years, private equity has generated a net annualised return of almost 13 per cent, according to MSCI Private Capital Solutions. This compares favourably to a broad index of US public equities, the Russell 3,000, which has generated an 11 per cent annualised return, according to Bloomberg data. Private credit has offered less than 9 per cent over the same period, according to MSCI. That beats the Bloomberg US high-yield bond index over that period by two percentage points annually.

But a wealth adviser will know that risk-adjusted returns matter most. High volatility will mean you have a greater chance of suffering a loss just when you need to withdraw your money for whatever reason, potentially selling out of your investment at the worst time.

Eren Osman, head of investment management at Arbuthnot Latham, stresses caution. “I’ve witnessed a clear trend into LTAFs and Eltifs by many funds that didn’t have much experience and exposure to this area,” he says.

Although long-term returns data makes a decent case for investing in private equity and credit, finding proof of promised diversification benefits while not forcing investors to take on more risk, can be elusive.

There is some data that supports the idea, though. According to Preqin, a financial research provider, the annualised gains from private equity over the past 15 years were 14 per cent, with an annual volatility a little over 6 per cent — the latter is less than half that of either the S&P 500, or the much broader Russell 3,000 market index. For private credit, long-term returns were 9.5 per cent but with almost half the volatility.

Such low volatility has raised a few eyebrows. MSCI cited the fact that private asset returns can rely on “smoothing” (or averaging over a period) rather than actual market prices. It prefers not to offer volatility data for this reason. Preqin said that its data had an element of smoothing.

It is a contentious area of debate. Commentators such as Richard Ennis, a former pension investment consultant, have questioned the use of lagged returns on private assets and how this diminishes volatility data. That does not mean that private equity and credit are necessarily bad investment choices, but that the size of the bet in one’s portfolio needs to be lower.

“I think people are underestimating the risks on private capital,” laments Peter Hecht, a leader in the portfolio solutions group at US hedge fund AQR. “There’s this mirage of ‘volatility laundering’” partly due to the data smoothing. “Prices and asset values should be marked more conservatively — a level where [one] could actually sell it.”

Frequently, proponents of the newer open-ended private asset funds emphasise the need to educate clients about illiquid assets. This is especially true for the newer semi-liquid vehicles. The collapse of Neil Woodford’s Equity Income fund in 2019 came as it increased investments in unlisted and other illiquid assets. When retail investors tried to pull their money out of the open-ended fund — which promised daily liquidity — and couldn’t, the fund was suspended. Ultimately 300,000 people were left out of pocket.

“You hope that investors [and the advisers] understand that the quarterly liquidity might not happen right away, [so] we need to work on the situation as a feature of the product,” says Olson at Goldman Sachs, who says this is a focus for her team.

Nevertheless, “the manager is only committing to liquidity if possible . . . I believe that many investors don’t fully understand this,” adds Hecht at AQR. “The message heard is ‘liquidity is almost guaranteed’.”

So what other incentives might wealth managers have to sell these new private asset funds to a new audience?

Wealth management is clearly a costly business. Cost to income ratios persist over the 70 per cent level, well above most banks and asset managers, hinting at inefficient operating models, points out Oliver Wyman.

As a result, wealth managers will be tempted by growth in a higher fee product, such as Eltifs and LTAFs, which have annual management fees of roughly 2 per cent plus performance and other sales fees, according to data from Morningstar.



Some governments encourage more investment in illiquid private assets such as infrastructure, with a lighter touch on regulation.

“If the government is encouraging investors to invest in long term, private investments, this can provide some comfort and cover,” says Leonard Ng, a partner at law firm Sidley who specialises in financial regulatory issues. “And the reality is the wealth manager may get higher margins and fees as a result.”

Moreover, the UK’s Financial Conduct Authority plans to change the framework to qualify individual investors as professional clients. Such customers are exempted from the extra protection that applies to retail consumers.

Big private equity groups see Europe’s open ended private asset funds as important to reaching a new market. “At Apollo we have pretty ambitious goals in terms of what we want to raise [from wealth managers] over the next five years,” Véronique Fournier, head of Emea distribution at Apollo.

But she and others in her industry stress that there is reputational risk if the private asset managers rush too quickly deploy any capital and cannot provide promised investment returns.

“As private market investing remains an alpha game, the question is whether these vehicles offer the potential to outperform,” notes Daniel Matson, head of private assets at Lombard Odier. “We have approached this area with caution.”

[Derby]

https://www.reuters.com/commentary/breakingviews/how-stock-market-collapse-can-lead-slump-2025-10-23/

How a stock market collapse can lead to a slump


Futures-options traders work on the floor at the New York Stock Exchange's NYSE American in New York City, U.S., October 22, 2025. REUTERS/Brendan McDermid Purchase Licensing Rights

LONDON, Oct 24 (Reuters Breakingviews) - Folklore holds that the great stock market crash of October 1929 pushed the world into depression. There's some truth in that. Still, had the financial foundations in the United States and elsewhere been robust, the sharp sell-off in the market would likely have been bearable. But the fundamentals were shaky and all hell broke loose. Herein lies a lesson for investors pondering the potential impact of any future slump.

A new book by Andrew Ross Sorkin, “1929: the Inside Story of the Great Crash in Wall Street History“ tells a familiar story. In the years before the market ructions in October that year, the leading figures on Wall Street did not distinguish themselves. Charles E. Mitchell, the ebullient head of National City Bank (forerunner of today’s Citi), flogged dodgy securities to an unwitting public. JPMorgan (JPM.N), handed out stocks at below market prices to its friends. Stock market pools – which enabled “pump and dump” operations – abounded. Nearly everyone in lower Manhattan’s financial district was caught up in the euphoria.

Sorkin tries hard to find a link between the shenanigans on Wall Street, the crash and the ensuing depression. An investigation by the Senate Committee on Banking and Currency, known as the Pecora Hearings, sought to hold leading bankers responsible for the economic calamity. But, as Senator Carter Glass said at the time, it was a show trial. In the end, National City’s Mitchell was charged with having transferred shares to his wife in a wash sale in order to crystalise losses and reduce his income tax. Jurors found him innocent. This is thin gruel, indeed.

JPMorgan’s Thomas Lamont believed that the cause of the crash "was a technical one rather than fundamental,” induced by forced sales of leveraged speculators facing margin calls. The Harvard Economic Society pronounced immediately after the crash that “a severe depression like that of 1920-21 is outside the range of probability.” Most people on Wall Street shared that view. Yet the slump duly arrived, millions of American workers lost their jobs, banks folded like dominoes and the Dow Jones Industrial Average dropped almost 90% from its September 1929 peak.



Economists usually blame the debacle on the lack of monetary and fiscal support from the U.S. authorities. But those props were also absent during the so-called “Forgotten Depression” at the start of the 1920s, after which the economy and markets came roaring back. The difference between these two downturns was that financial conditions had become extremely fragile over the course of the decade.

Agricultural prices were depressed throughout the 1920s, farms across the United States went bust and regional banks that held farm mortgages were in deep trouble. As Sorkin writes, countless banks were technically insolvent before the crash. Furthermore, real estate booms in Florida and Chicago collapsed around the middle of the decade. The first significant bank failure after the crash involved the Bank of United States in December 1930, which held second and third mortgages on New York properties, and had made a number of questionable transactions, including buying its own stock, through an affiliate, the Bankus Corporation.

In the words of the economist Herbert Simpson, writing in 1933: “real estate, real estate securities, and real estate affiliations in some form or other have been the largest single factor in the failure of 4,800 banks that have closed their doors during the past three years… it becomes increasingly apparent that our banking collapse during the present depression has been largely a real estate collapse.”

Financial conditions in continental Europe were even more perilous. Hyperinflations in Austria and Germany in the early 1920s had wiped out the capital of those countries’ banking systems. The German economy enjoyed a brief recovery thanks to large US capital inflows around the middle of the decade but those reversed in 1928 after the U.S. Federal Reserve raised interest rates. The collapse of Austria’s Credit-Anstalt Bank in May 1931 sparked off a Europe-wide crisis.

Ivar Kreuger, known as the “Match King” had made large loans to various governments, including
Germany’s, in exchange for monopoly concessions. After the Swedish businessman committed suicide in Paris in the spring of 1932, a black hole in his balance sheet was discovered that turned out to be larger than Sweden’s national debt. Kreuger’s operations were extremely complex: he controlled more than 200 subsidiaries, some of them secret, which issued complex derivatives. The “Kreuger crash” brought down the Boston banking house, Lee Higginson & Co.

Today, a frenzied excitement surrounding artificial intelligence is propelling both the U.S. economy and stock market. As in the late 1920s, the boom conceals profound weaknesses in the financial system.

Since interest rates turned up three years ago, the U.S. residential property market has ossified. Earlier this year, home resales fell to their lowest level in more than three decades. The cost of borrowing for U.S. commercial properties has climbed above rental yields, giving rise to a condition known as “negative leverage.” That’s a problem given that, according to Standard & Poor’s, trillions of dollars of commercial property loans need to be refinanced in the coming years.



When interest rates were at rock-bottom, lenders spurned liquidity, covenant protection and transparency in search of extra income. Private credit – supplied by non-bank lenders whose operations are complex, intertwined and opaque – has grown into a multi-trillion dollar business.
Cracks have started to appear in the edifice with the recent failures of Tricolor, an autolender, and First Brands, an auto parts company. Tricolor’s activities involved taking subprime loans, sometimes without documentation and repackaging them in asset-backed securities, which were then tranched, and sold on to institutional investors. Plus ça change.

This month, two regional U.S. banks, Zions Bancorp (ZION.O), and Western Alliance Bancorp (WAL.N),  announced losses on investments in funds tied to distressed commercial mortgage loans. JPMorgan Chief Executive Jamie Dimon fears more cockroaches may emerge. A messy unwinding of the AI boom could provide the catalyst. Concerned investors might consider the advice of an earlier Morgan honcho: “[stock] prices can go lower,” Thomas Lamont wrote to his son in the summer of 1929. “So be sure to keep plenty of cash. In my spare moments, I keep feeling cash is a good asset."