Gen II Fund Services has published its latest Core Alternative Managers' Mood Index (Cammi) report, indicating a surge of confidence in private capital markets as stakeholders look towards the investment landscape of 2025. The report, derived from a pan-European survey involving over 120 managers across various private market asset classes, reveals that 40% of fund managers anticipate an increase in investor allocations to private capital in the upcoming year, while 33% expect allocations to remain stable. In contrast, 27% forecast a decline in exposure to these investments.
The overall Cammi score, which serves as an indicator of sentiment in private equity, real assets, and private credit, has notably rebounded to 56.61, up from 42.37 recorded last year. This index is designed to summarise the allocation trends and perspectives of fund managers regarding whether their capital allocations are on the rise, falling, or remaining unchanged. Scores above 50 suggest an increase in allocations, those below 50 suggest a decline, while a score of exactly 50 indicates no change.
Particularly noteworthy is the segment on venture capital, which shines with a Cammi score of 59.05. Alex Di Santo, the head of private equity for Europe at Gen II, remarked on the buoyancy of this sector, stating, “With steady demand from institutional investors for early-stage, innovation-driven investments, especially around themes like technology, health, and energy, good market opportunities are returning. Consequently, this score is also a vote of confidence from these fund managers that the fundraising environment in 2025 will be easier than in 2024.”
Despite the overall optimism in private equity, traditional investment strategies like buyouts are experiencing a slight slowdown, as indicated by a Cammi score of 55.19. Fund managers attribute this dip to heightened competition and consolidation among larger players, which has resulted in a more cautious approach to fundraising. Meanwhile, there is cautious optimism surrounding secondary markets, bolstered by technological advancements like tokenisation, which are likely to enhance market accessibility.
Real assets are also gaining ground, with their segment reflecting a Cammi score of 58.87. The report points to robust momentum within the residential sector, propelled by urbanisation trends, increasing rents, and favourably responsive government policies. Many fund managers are diversifying their investments into resilient and high-growth sectors to better adapt to evolving market dynamics and manage inherent risks.
Private credit, which has recently encountered a challenging environment, shows signs of cautious growth with a Cammi score of 55.83. According to the report, managers are meticulously navigating the shifting credit landscape to leverage emerging opportunities.
In addition to allocation trends, the report highlights the rising priority of cybersecurity in investor due diligence. This reflects a growing awareness and concern over digital threats in the financial landscape. Furthermore, the report notes that tokenisation in the secondaries market is gaining prominence, potentially altering the manner in which private market assets are traded and accessed.
Source: Noah Wire Services