Majority of limited partners expect to raise private equity allocation

Nearly 60% of limited partners expect to increase their allocations to private equity this year, based on responses to the recently released S&P Global Market Intelligence's 2025 Private Equity and Venture Capital Outlook survey the firm conducted from November to January. Half plan to increase their infrastructure and private credit allocations.

Most of the LPs said they would maintain or increase allocations to various alternative asset classes.

Notably, the survey was taken before the global equity markets’ sharp downturn that began in February.

About 52% of the survey’s respondents expect private equity to generate the highest returns in 2025 vs. 39% that felt that way in 2024. Venture capital and private credit, cited by 17.3% and 13.5% of the LPs, respectively, were the second and third most popular responses.

However, many respondents somewhat agree or strongly agree that private equity and venture capital portfolio company valuations are too high and are likely to have markdowns this year. About 56% and 69% of the LPs combined somewhat and strongly agree that private equity and venture capital company valuations, respectively, are too high.