U.S. asset management giant Apollo Global will begin providing daily pricing information for private assets on 30 October, rather than at the end of September as announced. The assets covered include direct lending, asset-backed finance, multi-credit and opportunistic credit vehicles, and the boundary between private and public assets is reportedly becoming blurred.
U.S. asset management giant Apollo Global Management is launching an initiative to provide daily pricing information for private assets. The products covered include direct lending, asset-backed finance, multi-credit and opportunistic credit vehicles, and the company plans to publish estimates of daily beta and alpha. The announced launch date is 30 October. This is expected to make pricing information for private assets more readily usable as public information.
There are suggestions that this development could blur the boundary between private and public assets. Private equity and private credit serve as sources of funding and leverage, while a situation may arise in which greater transparency is required.
There is a view that competing asset managers are unhappy with Apollo's initiative because they earn high fee revenue from managing private, illiquid portfolios. While estimating alpha for private positions relative to beta in public markets is considered meaningful, there are also suggestions that questions remain regarding the practicality and interpretation of daily publication.
The author points out that Apollo's initiative could affect market volatility and asset allocation as U.S. innovation and the dynamism of capitalism increase. If more institutions choose similar levels of transparency, demand for hedging in public markets is expected to increase.