Private-markets access for retail investors is mostly good – but with caveats

Investors should be cautious about factors such as the policing of funds’ marketing, disclosures and practices, as well as the advisory process

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Genevieve Cua

Published Mon, Mar 31, 2025 · 06:00 AM

Private-market funds are expected to offer diversification benefits and higher risk-adjusted returns. Liquidity, however, is relatively infrequent and fees are higher. ILLUSTRATION: PIXABAY

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[SINGAPORE] Allowing retail investors to allocate to private-market funds is surely a good thing. Higher returns are sorely needed for retirement portfolios.

But it warrants caution as well. The devil is in the details – in the policing of the funds’ marketing, disclosures and practices. And, there is the financial advisory process, which is crucial to a well-informed decision. Advisers would be giving recommendations on a complex asset with higher fees – which could be a potentially lucrative revenue stream. They must be held to a higher bar when advising on such assets.

On Mar 27, the Monetary Authority of Singapore (MAS) published a paper seeking feedback on a regulatory framework to allow private-market fund investments for retail investors. Access is currently limited to accredited investors, defined as those with net personal assets of more than S$2 million, or an annual income of S$300,000.

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