Private equity and other private markets products
Intelligent diversification with your private bank
- Individual consultation from our specialists
- More than 25 years of experience in private markets
- Moderate minimum investments
Alternative investments can make a valuable contribution to optimizing the risk/return profile of your portfolio—especially in uncertain times. Since private markets are off-exchange investment opportunities, they are not subject to the risks typically associated with stock markets, such as short-term price fluctuations. Our strict selection criteria ensure high quality.
What are private markets?
Private markets investments are off-exchange investments. Compared to traditional investments, they offer additional diversification opportunities and the chance of higher returns. In the past, they were mainly reserved for institutional investors such as sovereign wealth funds, pension funds, and endowment funds due to high minimum investment amounts. However, private markets have been gaining popularity among private investors for some time now. The best-known sub-asset class is private equity, but infrastructure and private debt are also gaining in importance. Here we explain the advantages of the various over-the-counter investment opportunities.
Private Equity
Actively creating added value
Private equity involves providing equity capital to companies for a limited period of time, whether for start-ups, as growth capital for existing companies, or to finance restructuring. Fund managers are actively involved in the strategic direction and implementation of growth initiatives within companies and contribute to value enhancement through their expertise, experience, and network.
Arguments for investing in private equity funds:
Private equity expands the investment universe and enables investments in companies that are not accessible via the stock market.
Thanks to the active contribution of fund managers in the companies, private equity has historically achieved excess returns compared to the public capital market.
Due to the lower correlation of private equity with listed investments, the risk/return profile of a portfolio can be optimized.
Private debt
Companies looking for alternative credit options
Private debt is an alternative form of credit financing for companies. Instead of obtaining loans from banks or the public capital market, companies receive loans from credit funds. Since the 2008 financial crisis, traditional corporate loans from banks have lost importance worldwide, while private debt has become an important financing instrument for small and medium-sized enterprises (SMEs). These are often companies that are already supported by private equity.
Arguments for investing in private debt funds:
Private debt offers a higher return potential than publicly traded corporate bonds with a comparable rating.
The senior position in the capital structure ensures preferential servicing of repayment claims in the event of borrower default.
Thanks to the effective due diligence of fund managers, private debt funds focus on companies with a stronger credit profile than the average SME. This reduces the investment risk for investors.
Infrastructure
The central nervous system of an economy
Infrastructure refers to physical assets in which investments can be made, such as airports and seaports, toll roads, solar and wind farms, fiber optic networks, and data centers. In view of high levels of government debt and ongoing budget consolidation, many countries are increasingly unable to finance all the necessary infrastructure projects. Infrastructure funds help to close the resulting financing gap.
Arguments for investing in infrastructure funds:
Infrastructure investments provide essential services to the population and are therefore less susceptible to market cycles.
Revenues are often linked to long-term and indexed contracts, which enables a more stable cash flow and better protection against inflation.
In the past, infrastructure has shown a lower correlation with other asset classes such as equities, bonds, and real estate.
Our offers for you
Evergreen private markets funds
Invest in promising private markets funds that require lower minimum investment amounts than closed-end funds. Enjoy greater flexibility with entry and exit options at fixed times. Benefit from high investor protection and transparency. Let us advise you to find the right investment for you.
Closed-end private markets funds
Invest in selected private market funds that are only accessible to a limited group of investors via ABN AMRO's exclusive investment structures. Determine your individual priorities in terms of investment strategies, regions, and sectors. We present the options; you make the decision.
What can we do for you?
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Opportunities and risks of private market investments
Investments in private markets involve specific risks that you should consider in addition to general investment risks such as economic and geopolitical developments, interest rate fluctuations, and exchange rate risks. If you are aware of these risks, accept them, and act prudently, you can effectively leverage the opportunities offered by private markets for the long term.
Opportunities
- In the private markets sector, there is an opportunity to generate long-term returns that exceed those of the liquid market.
- Private markets expand the investment universe to include unlisted companies and projects.
- Historically, private market investments have exhibited lower volatility compared to publicly traded investments and have helped to strengthen the risk/return profile of the investment portfolio.
Significant risks
- Private market investments are entrepreneurial investments that carry the risk of partial or total loss of the invested capital.
- Investments in private markets are long-term investments whose resaleability is very limited compared to listed investments.
- Private market investments are often more complex than publicly traded investments and are therefore only suitable for investors with the relevant knowledge and experience.
- The valuation of private market assets is often more difficult than that of publicly traded investments due to limited transparency and data availability.
Private equity – special features, opportunities, and a look into the future
What private investors should know
Is private equity right for me? Alexander Herbert, Head of Private Equity at Bethmann Bank, explains the specifics of off-exchange equity investments.
Don't miss out on investment opportunities
More than 90 percent of investment opportunities are in private markets. Our investment expert Andreas Hegedüsch believes you shouldn't miss out on them.
Private equity remains a growth segment
A golden future for private markets? Alexander Herbert discusses developments over the past few years and those to come.
Our investment advice: independent, competent, reliable
Do you want to actively manage your investments? Are you looking for a sparring partner who is on the same wavelength as you? Our investment advisors are always available to assist you personally.
Our real estate agency: Access to selected properties – and buyers
Would you like to invest your capital in real estate or sell an existing property? We can help you with our many years of experience and exclusive network.
Risk warning
This document prepared by ABN AMRO Bank N.V. Frankfurt Branch (hereinafter referred to as Bethmann Bank) is intended for customers within the meaning of Section 67 (1) of the German Securities Trading Act (Wertpapierhandelsgesetz). It does not constitute an offer, advice, recommendation, or solicitation to buy or sell a financial instrument. Rather, it is for informational purposes only and cannot replace investor- and investment-specific advice. This document is not a financial analysis. It has not been prepared in accordance with legal provisions promoting the independence of financial analyses and is not subject to any prohibition on trading following the dissemination of financial analyses. If available, the purchase of a financial instrument mentioned in this document should be based exclusively on the information contained in the sales prospectus, supplemented, if necessary, by the most recently published annual report and semi-annual report, if such a report is available. The sales prospectus and the key investor information or the PRIIP key information document are available to customers in German at Bethmann Bank, Mainzer Landstraße 1, 60329 Frankfurt am Main, and can also be obtained from the issuer's/management company's website. Bethmann Bank accepts no liability for errors in the accuracy, completeness, and timeliness of this document, including all calculations, unless such errors were caused by Bethmann Bank intentionally or through gross negligence. This document is intended exclusively for clients who are neither residents of the United States nor US citizens and may not be distributed in the United States or to US citizens. US persons may also be individuals or corporations established under the laws of the United States or a US state, territory or possession. This document may not be photocopied or reproduced in any other way without the prior written consent of Bethmann Bank.