Semi-liquid vehicles set to surpass $3 trillion as more retail investors enter the market

Assets under management (AUM) in semi-liquid investment vehicles are projected to surpass $3 trillion by 2030, driven by increasing participation from retail investors. According to Carne Group, the market for semi-liquid funds has nearly tripled from 2020 to 2024, reaching approximately $349 billion, and is expected to continue rapid growth over the next several years. Wealth managers and private market fund managers alike are optimistic, with nearly 80 percent of private market fund managers and over half of wealth managers forecasting AUM between $3 trillion and $3.5 trillion by 2030. Semi-liquid funds offer investors access to traditionally illiquid assets such as private equity through open-ended vehicles that allow periodic redemptions. This structure has historically been limited to institutional investors, but recent years have seen a surge in interest from sophisticated and mass-affluent retail investors seeking portfolio diversification and potentially higher returns. Over 70 percent of wealth managers currently use semi-liquid funds for their clients, and nearly 30 percent plan to adopt them within the next two years. Many expect these funds to constitute around five percent of client investible assets within three to five years. The growth in demand is matched by an increase in supply, with 19 percent of private fund managers planning to launch new semi-liquid funds within the next year, a significant rise from the current 2 percent. Nearly half intend to introduce funds within 12 to 18 months, and an additional 29 percent within 18 to 24 months. Carne Group’s Des Fullam emphasized the importance of investor education on the long-term nature and redemption mechanics of these funds to ensure sustainable growth. He also noted a fundamental shift in private capital deployment, with wealth managers increasingly viewing private markets as essential components of diversified portfolios rather than optional additions. This trend presents substantial opportunities for fund managers to engage a growing retail investor base.