24 June 2026
Private markets are no longer a niche segment of the financial system. They have become a defining feature of modern capital markets, reshaping how companies raise capital, how investors allocate assets and how financial risks are distributed across the economy. A new report from the CFA Institute Research and Policy Center, Understanding the Growth of Private Markets, examines the forces behind this transformation and its implications for the investment profession.
The report argues that the expansion of private equity, private credit, venture capital, infrastructure and real estate is not simply a cyclical phenomenon, but a structural shift in global finance. Companies are remaining private for longer, institutional investors continue to increase allocations to alternative assets, and asset managers are expanding their private market offerings in response to growing demand. Together, these trends are fundamentally changing how capital is raised, priced and deployed.
According to the report, several forces are driving this evolution. Companies are increasingly attracted by the flexibility offered by private capital, while institutional investors seek higher expected returns, diversification and better alignment with long-term liabilities. Governments, meanwhile, are looking to private capital to finance infrastructure and other long-term investment needs.
At the same time, the report highlights a number of important challenges. As more economic activity shifts away from public markets, investors face greater difficulties in valuing assets, assessing performance and comparing investment opportunities. Limited disclosure, infrequent pricing, liquidity constraints and complex fee structures all require greater analytical discipline and stronger governance practices.
The rapid expansion of private credit also receives particular attention. As non-bank lenders play an increasingly important role in financing businesses, credit risk is migrating outside the traditional banking system. While this diversification of funding sources can strengthen capital formation, it also raises new questions around transparency, interconnectedness and financial stability.
Another key theme is the growing participation of retail investors. Regulatory changes and the emergence of new investment vehicles are making private markets more accessible to a broader audience. The report stresses, however, that expanding access must be accompanied by appropriate investor protection, clearer disclosures and a better understanding of the liquidity characteristics and risks associated with private assets.
For investment professionals, the implications are significant. The report argues that success in private markets will increasingly depend on capabilities that extend beyond traditional security analysis. Robust valuation methodologies, liquidity management, governance oversight, performance measurement and a deep understanding of private market structures are becoming core professional competencies.
The findings are particularly timely as private markets continue to represent a growing share of institutional portfolios worldwide. Industry research suggests that the next phase of development will be characterised less by favourable market conditions and more by operational excellence, disciplined capital allocation and enhanced transparency.
For members of CFA Society Italy, the report offers a comprehensive framework for understanding one of the most significant structural changes affecting today’s investment landscape. As private markets become an increasingly integral part of portfolio construction and capital formation, developing the skills and governance standards required to navigate them will be essential.
Ultimately, Understanding the Growth of Private Markets presents a clear message: the rise of private markets is redefining the investment ecosystem. Ensuring that this evolution is supported by greater transparency, stronger valuation practices and robust investor protection will be critical to sustaining long-term confidence and market integrity.