Eighty-six percent of private equity firms expect alternative investments to dominate retail portfolios in the next five years, says Apex Group

The latest research highlights growing retail demand for private markets and the role of technology in shaping the future of investment.

Apex Group, the leading global asset servicing provider, has launched a new report revealing 97% of asset managers see a strong retail interest in private markets, with private equity and real estate leading the demand.

The research paper called “Leading the shift: Transforming private markets in a retail-driven landscape,” was carried out by Global Custodian – an international securities services title. It is based on insights from senior leaders in funds with assets under management ranging from under $1bn to over $50bn; and explores how increasing retail investor engagement, technological advancements, and evolving industry strategies are reshaping the future of private markets.

Key findings of the report:

• Retail demand on the rise: 97% of asset managers report strong or moderate retail interest in private markets, with private equity (67%) and real estate (55%) leading demand. Retail interest is expected to dominate alternative investments in retail portfolios within the next five years (86%).
• Technology and innovation: The role of technology is critical in driving the retail shift. Almost 70% of asset managers see digital platforms as key enablers of retail participation, while 58% highlight blockchain and tokenisation as game-changing technologies for private market distribution.
• Barriers to retail participation: Regulatory restrictions (59%) and liquidity concerns (43%) are identified as the top barriers to retail investor participation.
• Outsourcing and lift-outs: 76% of firms have embraced outsourcing, with cost efficiency (70%) and time savings (71%) cited as the top benefits. Additionally, 65% of firms have engaged in lift-outs, transitioning in-house functions to third-party providers to drive better technology solutions and specialized talent.

Peter Hughes, founder and CEO of Apex Group, said:

“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. Apex Group is at the forefront of this trend, helping alternative managers and retail investors interact digitally using innovative solutions that are also seamlessly linked to traditional asset servicing.”

The report is based on insights from 117 senior executives, including c-suite leaders, portfolio managers, and finance directors at global asset management firms. The study captures perspectives from major financial hubs, including the US, UK, Hong Kong, and Singapore, and offers a comprehensive analysis of the factors driving the transformation in private markets.

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media@apexgroup.com

• To access the full report, please visit: https://www.globalcustodian.com/leading-the-shift-transforming-private-markets-in-a-retail-driven-landscape/

About Apex Group

Apex Group is dedicated to driving positive change in financial services while supporting the growth and ambitions of asset managers, allocators, financial institutions, and family offices. Established in Bermuda in 2003, the Group has continually disrupted the industry through its investment in innovation and talent.

Today, Apex Group sets the pace in fund and asset servicing and stands out for its unique single-source solution and unified cross asset-class platform which supports the entire value chain, harnesses leading innovative technology, and benefits from cross-jurisdictional expertise delivered by a long-standing management team and over 13,000 highly integrated professionals.  

Apex Group leads the industry with a broad and unmatched range of services, including capital raising, business and corporate management, fund and investor administration, portfolio and investment administration, ESG, capital markets and transactions support. These services are tailored to each client and are delivered both at the Group level and via specialist subsidiary brands.

The Apex Foundation, a not-for-profit entity, is the Group’s passionate commitment to empower sustainable change.