Article

What’s the outlook for private credit, private equity and real assets?

14 November 2022
Invesco
Alternative opportunities: semi-annual outlook

Investors continue to face macroeconomic headwinds. High and persistent inflation, rising interest rates, widening credit spreads and equity market volatility. Against this backdrop, alternative assets can be attractive for their diversification benefits.

In the latest edition of Alternative Opportunities, a semi-annual publication from Invesco Investment Solutions, we share our outlook for a range of private market asset classes.

Download the PDF report for the full analysis. For our latest capital market assumptions, referenced in the report, click here.

Download the report

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    Alternative opportunities 2022 semi-annual update

    By Invesco

    Read our analysis and take a look at our summary dashboard across key alternative asset classes.

Discover our capabilities

We offer an extensivea range of alternative investments, totalling over $199 billion in assets under management.[1] Our scale, combined with the breadth and depth of our offering, means we have the flexibility to meet your needs as markets evolve.

Frequently asked questions

A broad range of investments fall into the ‘alternatives’ asset class, including real estate, private credit, private equity, infrastructure and hedge funds. The asset class is growing, as investors continue to turn to alternatives for diversification and to navigate challenging market conditions.

Alternative assets often behave differently to public market assets like equities and bonds. Their unique characteristics mean that they can help investors achieve a diversified portfolio. Typically, they also generate higher returns than public market assets. 

We manage over $199 billion in alternative strategies, spanning private credit, real estate, private equity and beyond. We share some highlights below:

  • Real estate: Invesco Real Estate is a global real estate manager, with local people on the ground in 21 offices worldwide. We invest across the risk-return spectrum, from core to higher returning strategies. Our expertise covers public, private, equity and debt capabilities.

  • Private credit: Invesco Private Credit is one of the world’s largest and longest-tenured private credit managers. We pursue opportunities across broadly syndicated loans, direct lending, distressed debt and special situations.

  • ·Private markets platform: Invesco Investment Solutions offers a private markets platform, which streamlines the process of investing in alternative assets. Alongside Invesco’s in-house capabilities, it provides access to partner firms with expertise in private equity, private credit, real estate and infrastructure.

Related insights

Footnote

  • 1 Invesco as at 30 June 2022.

Investment risks

  • The value of investments and any income will fluctuate (this may partly be the result of exchange rate fluctuations) and investors may not get back the full amount invested.

     

    Alternative investment products may involve a higher degree of risk, may engage in leveraging and other speculative investment practices  that may increase the risk of investment loss, can be highly illiquid, may not be required to provide periodic pricing or valuation information to investors, may involve complex tax structures and delays in distributing important tax information, are not subject to the same regulatory requirements as mutual portfolios, often charge higher fees which may offset any trading profits, and in many cases the underlying investments are not transparent and are known only to the investment manager. There is often no secondary market for private equity interests, and none is expected to develop. There may be restrictions on transferring interests in such investments.

     

    Invesco Investment Solutions develops CMAs that provide long-term estimates for the behaviour of major asset classes globally. The team is dedicated to designing outcome-oriented, multi-asset portfolios that meet the specific goals of investors. The assumptions, which are based on 5- and 10-year investment time horizons, are intended to guide these strategic asset class allocations. For each selected asset class, we develop assumptions for estimated return, estimated standard deviation of return (volatility), and estimated correlation with other asset classes. This information is not intended as a recommendation to invest in a specific asset class or strategy, or as a promise of future performance. Estimated returns are subject to uncertainty and error and can be conditional on economic scenarios. In the event a particular scenario comes to pass, actual returns could be significantly higher or lower than these estimates.

Important information

  • This document is marketing material and is not intended as a recommendation to invest in any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication. The information provided is for illustrative purposes only, it should not be relied upon as recommendations to buy or sell securities.

     

    Where individuals or the business have expressed opinions, they are based on current market conditions, they may differ from those of other investment professionals, they are subject to change without notice and are not to be construed as investment advice.