We examine secondary market pricing for private equity buyout funds to assess what historical price trends reveal about the current market. Using almost 3,000 pricing observations spanning September 2015 through the end of 2025, we find that secondary market prices average 8% below net asset value (NAV) and move closely with public equity returns, consistent with prior evidence that discounts reflect a cyclical liquidity cost rather than mispricing. Following a Heckman selection framework, we show that the factors that determine whether a fund transacts are somewhat different from those that determine the price it fetches. We also examine the rapid growth of evergreen vehicles, which are identified as buyers in more than a quarter of our sample. We examine if transactions with evergreen buyers are associated with higher prices and do not find reliable effects – actual prices can be above or below modeled prices depending on method. The largest positive effect we document is that aggregate secondary prices since 2023 have averaged about 1.9 percentage points above the path implied by pre-2023 fundamentals. Despite record transaction volume, pricing through 2025 looks consistent with a properly functioning market.
Greg Brown, UNC Kenan-Flagler Business School & IPC
William Volckmann, Institute for Private Capital
