Somewhere in Midtown Manhattan, on most weekday afternoons, a few people in ordinary clothes move billions of dollars’ worth of assets on a quiet floor of an office building that hardly anyone outside the finance industry has ever heard of. They do not engage in stock trading. They are not engaging in bond trading. These are trading positions in private corporations and private equity funds that were never intended to be tradable in the first place. Even though it is still persistently hard to see from the outside, this secondary market for private assets has grown to be one of Wall Street’s most significant locations.
Though they only go so far, the numbers are helpful. Transaction volume reached an all-time high of almost $160 billion in 2024, and projections for 2026 indicate more of the same. To put that in perspective, that is more than some of the biggest banks in the world’s total yearly revenue, all of which is passing through a market that didn’t actually exist at scale fifteen years ago. People who work there feel as though they have stumbled onto something that is meant to be a temporary solution but is instead turning into the main event.
| Information | Details |
|---|---|
| Market Type | Private market secondaries |
| 2024 Transaction Volume | Approximately $160 billion |
| Dry Powder Available | Over $250 billion |
| Private Credit Secondaries (2024) | Exceeded $12 billion |
| Key Drivers | IPO slowdown, longer private holds, LP liquidity demands |
| Dominant 2025 Trend | Continuation funds |
| Typical Discount to NAV | 10% to 30% |
| Interest Rate Pressure | High rates compressing exits |
| Key Mechanism | GP-led transactions |
| Retail Access Vehicle | 40 Act interval funds |
| Major Platforms | Carta, Percent, Forge Global |
| Wall Street Desks | Jefferies, Goldman Sachs, Lazard |
| Buyer Class | Specialized secondary funds |
| Top Limited Partners | Pension funds, sovereign wealth funds, endowments |
| 2026 Outlook | Continued growth, record fundraising projected |
| Primary Risk | Discounted exits, valuation opacity |
It is structural in nature. Businesses are remaining private for far longer than in the past. In recent years, the public markets’ entire machinery, which formerly offered investors in private companies a reliable way out, has virtually stopped. IPO windows abruptly open and close. The math of leveraged buyouts has become more difficult due to high interest rates. Additionally, endowments, pension funds, and other limited partners who invested in private equity ten or fifteen years ago are now respectfully but forcefully requesting their money back. Wall Street’s way of saying “yes” without really making any traditional sales is through the secondary market.
All of this is now symbolized by continuation funds. If you squint at it long enough, the mechanism is easy to understand. When a private equity fund is nearing the end of its natural life, a general partner might transfer its finest assets into a new entity, raise more funds from new investors to buy them out, and return cash to the original limited partners.
Theoretically, everyone wins. The assets that the GP finds appealing are retained. The money goes to the old investors. Companies that would not otherwise be accessible are made available to the new investors. Many of the top fifty private fund managers employed this tactic in one form or another in 2025. They might be creating a brand-new form of permanent capital. They might also be kicking a big can down a long road.
A staggering amount of money has been generated by specialized secondary funds to take part. The amount of dry powder available for these transactions currently exceeds $250 billion, and a number of the companies managing it have a track record of beating conventional buyout funds. Purchasing private equity holdings at a discount—typically 10 to 30 percent below declared net asset value—seems to give investors with a margin of safety that the larger market no longer delivers. Depending on who is speaking, those discounts may indicate distressed selling or clever pricing. Depending on the seller, both readings are very likely accurate.
The retail angle, on the other hand, is where things become both legitimately fascinating and a little awkward. Mass-affluent investors with five-figure brokerage accounts who would never have been eligible for a private equity allocation now have access to private markets thanks to the growth of 40 Act interval funds. The secondary market is frequently used by these funds to swiftly deploy capital. It circumvents the uncomfortable issue of holding onto funds while awaiting the closing of primary deals. As this develops, it is difficult to avoid wondering whether retail investors completely get what they are purchasing and whether the goods are being created with their interests in mind or just the distribution issue facing the sector.
The most recent development is private credit secondaries, whose volumes have already surpassed $12 billion in 2024 and are still rising. The secondary market has provided a means for lenders to recycle capital while pressure has been placed on private credit funding. The unglamorous work of constructing the plumbing is being done by platforms like Carta and Percent as well as specialized desks at Jefferies, Goldman Sachs, and Lazard. It’s mostly opaque. The majority of it is effective.
The issue that no one wants to answer too confidently is whether all of this will still hold true in 2026. Real capital, real demand, and real momentum exist. Additionally, there is a growing feeling that some of this activity is occurring because the alternatives—a return to free money or an IPO recovery—are not likely to occur anytime soon. What the rest of the system is unable to do, the secondary market is. Where there are no exits, it provides them. That’s sufficient to keep things going for the time being. It’s another question entirely if it will be sufficient in the long run.