Direct investing by institutional investors in illiquid assets is here to stay, although it will not displace the traditional delegated investment model. growth is likely to be steady, corresponding to the underlying increase in institutional assets, with some potential for faster growth if direct-investing teams deliver long-term performance and value for money superior to that obtainable via delegated investing. Even in an adverse scenario, direct investing is likely to grow in absolute terms, the main difference being that only the largest institutions would be likely to pursue direct investing, and larger institutions will become more selective in considering when and how to do so.
Many governments have expressed an interest in attracting capital to fund the development and refurbishment of infrastructure.
The steady growth of direct investing alongside delegated invest- ing models has implications for asset owners, asset managers and policy-makers alike.