Perspectives · Alternatives · 2026

Why private assets look calmer than they are

A listed share has a new price every second. A private company, property or loan is valued by an appraisal or a model, often once a quarter or once a year. That makes private assets look steadier than public ones.

The steadiness can be partly an illusion. If a valuation is updated only occasionally, a fall in value can show up late, and the reported figure moves less than the economic reality would. This smoothing flatters measures of risk, so comparing private and public returns directly can mislead.

Ask how an asset is valued, who does it, how often, and what happens when there is a difference between the valuation and the price of a real sale.

In the early years of many private equity funds the reported return is also negative as fees and costs are charged before gains arrive. This is known as the J-curve.

General information only; not investment advice. Read the risk warning.