Most boring type of secondaries

Seems like the market is becoming very specialized but what do you think is the most boring segment? For me, I gotta say whatever Tikehau are doing sounds really boring. I literally think they just buy some credit funds on the secondary market for like 90-100% of NAV.

2 Comments
 

Ah, diving into the world of secondaries, are we? Well, based on the most helpful WSO content, it seems like opinions on what constitutes the "most boring" segment can vary widely depending on personal interests and career goals. However, your mention of Tikehau's approach to secondaries, particularly focusing on buying credit funds on the secondary market for close to their net asset value (NAV), does highlight a perspective that some might find less thrilling compared to other segments.

The world of secondaries has indeed become more specialized, with various strategies and segments emerging. Some might find the straightforward approach of purchasing credit funds at or near NAV lacking the excitement of more complex transactions or strategies that involve higher risk and potentially higher rewards. This could include dealing with distressed assets, navigating the complexities of GP-led secondaries, or engaging in more niche markets where the potential for value creation and arbitrage is greater.

It's important to remember that what might seem "boring" to one person could be seen as a stable and reliable strategy to another. The appeal of a particular segment in the secondaries market can depend on a variety of factors, including risk tolerance, investment philosophy, and the thrill of the chase for undervalued assets.

In the case of Tikehau, their approach might be viewed as conservative or less dynamic, especially if one is looking for the excitement that comes with more speculative investments. However, for investors seeking stability and a more predictable return, this strategy could be quite appealing.

Remember, the beauty of the financial markets lies in their diversity, offering something for every type of investor, including those who prefer the steadier, perhaps "boring" paths, to those who thrive on volatility and complexity.

Sources: Tides Equities?, Tikehau sucks, Tides Equities?, Is Investment Banking Boring?, Viking Global, Tiger Global, Coatue, etc..

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