By Michael Aldridge, Co-founder, President, and CRO, Accelex
Capital markets are listening intently to the US administration as it fine-tunes the details of its global tariff plan. The web of exemptions and renewed threats has sent shockwaves through public markets. This uncertainty has also rippled through private markets, causing a sell-off as investors rush to reassess their allocations.
Although traditionally viewed as sources of stability during times of turbulence, the volatility triggered by these huge macroeconomic headwinds is beginning to take its toll on private markets. Limited Partners in private equity, venture capital, and other alternative funds are being forced to readjust their risk exposure.
However, private markets have traditionally been opaque, making it extremely challenging for these firms to quickly assess their exposures and make decisions based on data and facts. The recent turmoil is a wake-up call for these firms to prioritize transparency and data so they can take quick and effective action in the event that we see similar events in the future.
Volatility could be the new norm
Private markets have traditionally been seen as relatively insulated from public-market panic. Their longer time horizons, slower valuation cycles, and lower visibility have helped them ride out short-term swings and dips in the broader markets.
However, rising global trade tension is injecting new levels of volatility into private markets, putting fund managers under more scrutiny as Limited Partners (LPs) reassess their private allocations in light of broader macroeconomic concerns.
For many, this is unfamiliar territory. Private markets rarely have to contend with this level of near-term instability. And yet, as the events of the past weeks show, the era of slow and steady private capital may be giving way to something more reactive and exposed.
Shifting the focus to liquidity and the rise of secondaries
Historically, private markets were understood to be long-hold investments. Under more stable economic conditions, investors would commit capital, lock it up and wait many years, or even over a decade, before taking returns.
However, with investors now questioning whether their private portfolios are agile enough to respond to market swings, the need for faster access to liquidity is rising.
This is where the private secondaries market is stepping up. Although this used to be considered a niche segment, private secondaries are becoming the go-to solution for unlocking capital in traditionally illiquid private markets.
By enabling investors to exit their private markets positions early, secondaries provide liquidity and the opportunity to rebalance risk and exposures. They also give more opportunistic investors a chance to acquire discounted assets.
As a result, we’re likely to see them continue to grow and reshape how investors exit their private asset positions.
Growing calls for transparency
With increasing secondaries volume comes the need for greater transparency into private assets.
Private markets are, by nature, opaque. Valuations are infrequent, reporting is inconsistent, data is siloed and delivered in document format. By contrast, public markets offer near-instant price discovery, real-time analytics, and constant disclosure.
This means that private market investors often have limited visibility over what they’re actually getting into. This becomes a dangerous game, particularly when the market moves fast and informed decisions need to be made quickly.
Opening up access to data-backed insights into private assets is the key to fixing this. Data is the lifeblood of investment decision-making, and investors need accurate, structured, real-time information to understand their portfolios, assess risks, and react intelligently to market changes.
It’s crucial for investors to understand the operating performance of portfolio companies within funds. Given the uncertainty around tariffs and risks of economic slowdown, it is these companies, particularly SMEs, that are likely to see their margins and growth take the biggest hit. So, when it comes to secondaries, buyers and sellers must have the tools and resources to understand the fundamentals of these companies’ trajectories and business resilience.
For fund managers and asset servicers, this means making use of technology, such as AI, to deliver deeper, clearer reporting—and doing so consistently. Creating clearer private markets insights also wins investors’ trust. Those who fail to do so risk losing out as the market evolves without them.
The changing face of private markets
As economic and geopolitical uncertainties persist, private market investors are realising they need to modernize and learn to adapt as quickly as their public-market peers.
As investors look for more flexibility and clarity around their private market investments, fund managers will be expected to handle capital with a new level of precision and responsiveness.
The winners in this next chapter will be those who embrace digital tools, modern data infrastructure, and secondary market solutions. These aren’t just operational upgrades—they’re strategic imperatives for survival and success.
