KKR published their assumptions for expected returns, yields, and volatility, correlations, and manager dispersion across both public and private markets. Henry McVey and his team emphasize the investing environment today differs meaningfully from the past decade and incremental performance is increasingly driven by how portfolios are constructed, not simply by what you own.
Capital Market Assumptions: An Expanded Toolkit for the Next Investing Regime
KKR
Henry McVey
Research
12 Pages
Key Takeaways
Opportunity set narrows: Asset class spreads are shrinking, so execution and sizing choices matter more than labels.
Starting points bite: Elevated valuations and tight spreads raise the bar for taking risk in public markets.
Private markets matter: Illiquidity premia can help, but manager selection and underwriting discipline drive outcomes.
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