The current difficult market environment will create fertile ground for private equity and hedge funds to boost their performance, according to JPMorgan Asset Management.
“Dry powder on private equity balance sheets can be deployed now at lower entry multiples, broadly offsetting higher debt funding costs,” Bilton wrote
While the coronavirus-induced turmoil is hurting the economy, Bilton doesn’t see much in the way of “first-order” changes — he doesn’t envision the recession as significantly altering potential growth in the long term.
Other forecasts in the report include:
- Both monetary and fiscal policy will remain expansionary into the recovery, which should lead to steeper curves and reflationary pressure in the intermediate term
- Equities are likely to be supported relative to bonds over the full extent of the 10- to 15-year forecast horizon
- Other regions may start to catch up with the U.S. stock market in the 2020s
Source: Bloomberg
Can’t stop reading? Read more
Blackstone taps bond market as private credit BDCs end issuance drought
Blackstone taps bond market as private credit BDCs end issuance drought Blackstone's private...
EQT raises the stakes with revised $12.3bn bid for Intertek
EQT raises the stakes with revised $12.3bn bid for Intertek EQT has tabled an improved takeover...
Temasek’s Azalea bets on evergreen structure to democratise private equity access
Temasek's Azalea bets on evergreen structure to democratise private equity access Azalea, a unit...