Stocks have been pretty volatile the last few weeks with a lot of big tech names -10% to 20% during that time especially with higher rates. So as an investor, wouldn’t you want to shift your money to PE which has lower volatility/exposure to the market vs. give it to LO/HF that have more exposure and have lost $ in this volatility?
Seem like this weakness is a tailwind for PE. Remember seeing a KKR slide showing that the markets and public real estate were down a ton in 2022, but PE/private real estate held up way better showing that PE is adding value
Vol is good for us actually (HF - L/S equity, macro, quant), below extreme outlier situations which we are nowhere near. This is sweet spot. More vol = more $ per trade. Minting money these past few weeks.
Volatility is good
PE held up better because GPs aren't accurately marking their funds
LPs have little faith in PE GP marks (see how they price on the secondary market for reference). Strategic asset allocation will not have changed, but a tactical shift towards hedge funds / absolute return/ portable alpha is likely.
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