Private equity’s allure poses big risks for the stock market and its investors in the next recession


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Private equity has taken center stage in active investing, and that means the stock market and its investors could face more challenges — especially in a recession.

The transition is already underway and according to asset manager AllianceBernstein, won’t be ending soon. In a note to clients this week, the firm outlined an upcoming decade in which the “main expression of active investing” is in private markets.

Analysts say this shift introduces potential problems. Liquidity could dry up in public markets, causing more volatility. And retail investors may have fewer high-growth opportunities as companies easily raise money privately, opting out of listing…


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