What are the key trends that JPMorgan sees for alternatives in 2025?

What are the key trends that JPMorgan sees for alternatives in 2025?
Report highlights opportunities for alts investors across asset classes.
JAN 29, 2025

With alternative investments attracting increased attention from investors seeking to diversify their portfolios beyond stocks and bonds and hedge against inflation, what are the key trends in the major alts asset classes in 2025 and beyond?

JP Morgan Asset Management has published its latest Global Alternatives Outlook which looks at the next 12-18 months and identifies the opportunities for investors in private equity, private credit, real estate, infrastructure and transport, hedge funds, and secondaries.

“In an environment where traditional portfolios face headwinds such as high valuations, positive stock-bond correlations, and persistent rate volatility, the case for alternatives becomes increasingly compelling,” said Anton Pil, global head of Alternatives Solutions. “These conditions underscore the importance of diversifying with alternative investments to achieve more resilient portfolio outcomes.”

Among the key themes across each sector are:

Real Estate:

  • Growth and Inflation Protection: Pro-growth policies are expected to bolster net operating income growth, with real estate offering potential inflation protection through rent increases and property revenue growth.
  • Valuation Opportunities: US real estate presents a generational investment opportunity as valuations appear to be bottoming out, with improving fundamentals.

Infrastructure and Transport:

  • Inflation and Trade Dynamics: Infrastructure and transport assets are well-positioned to provide critical inflation protection as we may see reconfigured supply chains and trade agreements evolve.
  • Global Transport: Transport assets are expected to benefit from changes in global trade routes and increased demand for domestic logistics.

Secondaries:

  • Capital Deployment: Secondaries offer efficient access to private equity and private credit activity, allowing investors to capitalize on growth-oriented companies while mitigating j-curve and blind pool risks. The expansion of alternatives into the private wealth market has also led to a rise in semi-liquid structures, which typically rely on secondaries to source liquidity and invest.

Private Equity:

  • Pro-Growth Policies: US tax reform and deregulation are anticipated to enhance corporate profitability, reviving IPOs, M&A, and lending activities. This environment is expected to create favorable conditions for private equity dealmaking and exits.
  • Valuation Considerations: Investors should be mindful of valuations, especially for investments initiated in the post-pandemic, low-interest-rate environment.

Private Credit:

  • Lending Opportunities: A robust US growth environment and deregulatory agenda are likely to support both public and private lending, with private credit continuing to capture market share.
  • Interest Rate Impact: Higher interest rates could pressure lower-quality borrowers, but also create opportunities for distressed and special situations credit strategies.

Hedge Funds:

  • Volatility and Alpha Generation: Hedge funds are poised to navigate fiscal and monetary policy shifts, with market volatility offering opportunities for alpha generation, particularly through long/short strategies and macro hedge funds.
  • Diversification: Given high correlations in equity and fixed income markets, hedge funds provide compelling diversification benefits and offer uncorrelated sources of return.

“Our 2025 Alternatives Outlook leverages our more than 50-year track record as a private markets investor, and this year’s outlook comes at a time when many types of investors are evaluating their allocations to alternatives,” said Jed Laskowitz, global head of Private Markets and Customized Solutions. “With the US economy in a mid-to-late cycle stage, private markets present potential opportunities for enhanced returns versus public markets, inflation protection, and diversification benefits.”

Latest News

SEC charges Chicago-based investment adviser with overbilling clients more than $2.5M in fees
SEC charges Chicago-based investment adviser with overbilling clients more than $2.5M in fees

Eliseo Prisno, a former Merrill advisor, allegedly collected unapproved fees from Filipino clients by secretly accessing their accounts at two separate brokerages.

Apella Wealth comes to Washington with Independence Wealth Advisors
Apella Wealth comes to Washington with Independence Wealth Advisors

The Harford, Connecticut-based RIA is expanding into a new market in the mid-Atlantic region while crossing another billion-dollar milestone.

Citi's Sieg sees rich clients pivoting from US to UK
Citi's Sieg sees rich clients pivoting from US to UK

The Wall Street giant's global wealth head says affluent clients are shifting away from America amid growing fallout from President Donald Trump's hardline politics.

US employment report reactions: Overall better than expected, but concerns with underlying data
US employment report reactions: Overall better than expected, but concerns with underlying data

Chief economists, advisors, and chief investment officers share their reactions to the June US employment report.

Creative Planning's Peter Mallouk slams 'offensive' congressional stock trading
Creative Planning's Peter Mallouk slams 'offensive' congressional stock trading

"This shouldn’t be hard to ban, but neither party will do it. So offensive to the people they serve," RIA titan Peter Mallouk said in a post that referenced Nancy Pelosi's reported stock gains.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.