Evolving Perspectives on Risk: Public and Private Investments

The landscape of investment risk has fundamentally shifted, with both private and public investments now encompassing elements of safety and risk. The traditional view that private investments are inherently risky and public investments safe is outdated. As the distinctions blur, portfolio management strategies will need to adapt significantly. Investors may soon recognize little difference between investment grade public and private assets, as the mechanisms of public markets—such as daily pricing and market making—are being integrated into private markets. This transition points towards a substantial growth opportunity, with the fixed income sector being notably larger than the alternative investment bucket, primarily consisting of public credit. The future will see a democratization of investment choices, reshaping how portfolios are constructed and managed.