The trend of growing interest in private markets has made its mark across the board and shows no sign of slowing down. Latin America is no exception, according to a recently published survey by the specialized information platform Preqin, with a particular appetite for private debt.
These two asset classes, revealed the Latin America Investor Survey for this year, are attracting the most interest among regional investors. When asked which assets they expect to increase their exposure to in the next 12 months, 60% said they anticipated strengthening their bet on private debt.
This was followed by private equity—another area of high interest for Latin American investors of all sizes—with 40%. To a lesser extent, the region is also looking at infrastructure, with 41% expecting to increase their position in the asset class.
These three categories are, in fact, where investment professionals in the region see the main opportunities in Latin America over the next 12 months. Some 58% see greater appeal in private debt, while 46% pointed to private equity and infrastructure.
Regarding the geographic composition of portfolios, the Preqin survey revealed that home bias continues to prevail. Some 67% of the professionals surveyed indicated that Latin America—particularly Brazil and Mexico—offers the best investment opportunities for the next 12 months. This is followed by North America (43%), marking a sharp contrast with the 2024 survey, when 79% preferred the northern region.
Strong International Results
Despite the local bias in terms of future opportunities, when measuring satisfaction with asset performance, foreign portfolios are the clear winners, according to Preqin’s analysis. When asked about the expectations/results balance across various asset classes, investors in the region appear more satisfied with their international portfolios than with their local ones.
Once again, private debt receives the most praise. Some 38% of respondents indicated that their private debt assets exceeded expectations. In contrast, only 22% were surprised by the performance of their domestic private debt portion.
In the case of private equity, 18% saw their international portfolio outperform expectations, compared to just 9% who said the same about their local investments in this asset class.
The exception to the enthusiasm was the real estate investment segment, where none of the investment professionals surveyed saw their portfolios—whether domestic or foreign—exceed expectations.
Despite the strong results, Latin American investors have certain criticisms of foreign managers offering these types of strategies, particularly regarding sector expertise. Looking at the segment of international GPs, 47% of the professionals surveyed by Preqin indicated that the lack of focused experience was the most common mistake among international managers.
