Investor sentiment toward private equity remains broadly constructive despite heightened concern around exits and a more cautious short-term stance. According to Preqin’s November 2025 investor survey, 80% of investors cite the exit environment as a top challenge, matching levels last seen in 2022 during the sharp interest rate tightening cycle. Macroeconomic uncertainty in 2025—driven by trade policy risks, market volatility, and delayed monetary easing—has reinforced exit-related anxiety and dampened near-term optimism.
Commitment to the asset class: losing steam
Short-term commitment plans have weakened (see chart 1). Nearly half of respondents intend to maintain current commitment levels over the next 12 months, while the share planning to invest less has doubled to 16%. At the same time, the proportion expecting to commit more capital has fallen from 50% to 36%, signalling increased caution rather than a structural retreat from the asset class.
Chart 1: Investors more prudent with their short-term commitment plans Preqin Investor Surveys, November 2020–2025
Long-term allocation intentions remain resilient. Despite a modest increase in investors planning to reduce exposure, 88% still intend to maintain or increase private equity allocations over the longer term. According to Preqin, those reducing exposure may be responding to the slower-than-expected resolution of cyclical challenges that have persisted since 2022, particularly muted exits and distributions.
Performance concerns rise, but conviction holds
Performance perceptions have also softened. Private equity lagged public markets over the 12 months to June 2025, extending a trend that began in 2023 as public equity gains were concentrated in a small number of AI-related mega-cap stocks. While 56% of investors remain satisfied with recent private equity performance, the survey noted that dissatisfaction rose to 33%, up three percentage points year over year. Importantly, expectations of significantly weaker performance remain limited, suggesting that most investors continue to believe in private equity’s long-term value proposition.
Structural and strategic preferences evolve
Structurally, investor preferences are evolving. Interest in open-ended fund structures has increased, with 21% targeting them in the next 12 months, reflecting demand for improved liquidity and accessibility—especially among non-institutional investors (see chart 2). Nevertheless, pooled single-manager funds and co-investments remain the most popular structures overall.
Chart 2: Open-ended funds gaining ground but from a low level Preqin Investor Surveys, November 2020–2025
From a strategy perspective, small- and mid-market buyouts are viewed as the most attractive opportunity set (64% of respondents), supported by “stronger historical performance” and comparatively easier exit pathways (see chart 3). Secondaries continue to gain favour, cited by 52% of investors, underscoring their role in liquidity management and portfolio rebalancing.
Chart 3: Maintaining an edge of over other asset classes Preqin Investor Surveys, November 2020–2025
Investors looking at Europe and Japan
Geographically, sentiment has shifted meaningfully, according to the survey. Western Europe has seen a sharp increase in perceived attractiveness, rising to 48% of respondents, while Japan has also gained prominence (see chart 4). Although interest in the US edged lower, it remains the most frequently cited core market.
Chart 4 Reallocating out of the US—for now Preqin Investor Surveys, November 2020–2025
In emerging markets, India remains the top destination despite declining enthusiasm, while Central & Eastern Europe recorded a notable rise in investor interest, reflecting a broader diversification of regional opportunity sets.
Overall, the survey depicts an investor base that is tactically cautious but strategically committed, adjusting structures, strategies, and regional focus while maintaining long-term conviction in private equity.
