Equity | Secondaries

Private market secondaries can provide competitive risk-adjusted returns, smaller losses during market shocks and faster portfolio deployment, making them an increasingly important private-markets allocation.

• Secondaries delivered a 12.6% median net IRR for 2005–2020 vintages, with a 16.4-point spread between the bottom and top deciles, about 39% narrower than private equity’s outcome range.
• The bottom-decile net IRR was 4.8% for secondaries versus 1.4% for private equity and negative 3.5% for venture capital; the median secondary return was close to private equity’s 13.5%.
• During major market disruptions, secondaries fell about 10% versus 20% for private capital during the Global Financial Crisis, returned about 7% versus 1.5% in 2022, and rebounded 44% versus 34% in 2021.
• Their seasoned portfolios can shorten deployment and distributions, reduce the J-curve, diversify exposure across managers, vintages, sectors and hundreds of companies, and provide greater visibility than blind-pool commitments.
• The market shifted from predominantly LP-led transactions before 2020 toward a meaningful share of GP-led deals, especially single-asset continuation vehicles, while annual volume reached $226 billion in 2025, up 41% year over year.

Takeaway: Secondaries offer a potentially resilient and diversified way to access private markets, but the growing role of concentrated GP-led transactions increases dispersion and makes manager selection, sourcing and underwriting capabilities more important.