Four Reasons to Take a Closer Look at Private Equity Secondaries 

Following a busy 2024, the secondary market is expected to remain active, with narrowing bid-ask spreads and growing demand for liquidity from both limited partners (LPs) and general partners (GPs). For LPs, reduced distributions and longer hold periods have increased interest in secondary sales, while GPs continue to explore continuation vehicles (CVs) to extend the lifecycle of high-performing assets.

Secondaries may offer a unique way to buy and sell interests in private equity funds mid-cycle, providing investors with earlier liquidity, greater visibility, and broader diversification compared to traditional primary commitments.

What makes this space increasingly compelling is the ability to blend different types of transactions—LP-led deals offering immediate diversification and early distributions, alongside GP-led deals that provide access to high-quality assets that may not come back to market.

Mercer views secondary transactions as a flexible, risk-aware way to build exposure to private markets—especially as GPs hold onto their best assets longer. For investors looking to enhance diversification and navigate today's more complex private equity landscape, secondaries are fast becoming a vital tool.

Read our important notices.