Lure of ‘Free Money’ in Secondaries Nears a Mania
The article discusses the growing demand for secondary funds focused on private markets, which is partly driven by an accounting loophole. Some investors are taking advantage of this loophole to purchase assets at a discount and then revalue them at par, effectively creating a "free money" opportunity. The article suggests that this trend is approaching a "mania" stage, as investors are increasingly drawn to the potential for easy profits. However, the article also cautions that this practice may not be sustainable and could lead to inflated valuations and potential risks for investors. The article highlights the increasing popularity of secondary funds and the lure of "free money" in the private markets, but also warns of the potential dangers associated with this trend.
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