July 2025

June markets rode a volatile mix of geopolitical disruption, shifting central bank policies, and surprising investor resilience, conditions under which hedge funds delivered strong performance. Nearly all strategies ended the month in positive territory, with the HFRI Fund Weighted Composite Index rising 2.4%. Equity Hedge led the way, up 3.4%, with the Technology Index surging 7.1%.

When it comes to the global energy system, one thing is undeniable: the landscape has never been more complex. And with complexity comes opportunity. In 2025, we sit at the convergence of a perfect storm of factors: rising electricity demand, new and unpredictable usage patterns, distributed energy resources, and supply chain instability.

The private markets have their investment sights set on defense companies and the technology firms that support that industry as countries, especially in North America and Europe, increase their focus on border control and national security interests. Last month the countries within NATO agreed to allocate at least 5% of their GDP on defense over the next 10 years.

The Private Credit market has grown rapidly over the last decade and in an increasingly competitive landscape, a direct lender is only as good as the deals they originate. Origination is often the biggest cost of deployment for the GP, but a fund manager ignores it at their peril, as a weak origination strategy can force them into unfavourable lending scenarios.

Adopting an evergreen structure can be mutually beneficial to managers and investors. For the manager, truly evergreen funds enable continuous fundraising, with no need to artificially wind down a structure and create a new vintage. Similarly, many investors welcome a permanent product, especially given the ability to exit the structure.

Market practitioners love to quote a phrase attributed to Mark Twain, that history does not repeat itself, but it often rhymes. When it comes to the development of new asset classes, financial history tells us that they evolve in a similar manner. At first the new asset class is treated with skepticism as people struggle to understand the benefits it delivers.

Private credit has transformed from a niche strategy into a core institutional and private investor allocation. Preqin forecasts global private debt AUM at $2.64 trillion by 2029, nearly doubling from 2023. Direct lending alone is expected to account for two-thirds of that growth, as companies increasingly turn to private lenders over banks for flexible, rapid capital solutions.

Arlington Capital Partners held the first close for its seventh flagship fund, Arlington Capital Partners VII, reportedly securing over $2.5 billion toward a multibillion-dollar target. The Washington DC firm focuses on government services, aerospace, defence, healthcare and industrial technologies, sectors characterised by high regulatory barriers and mission-critical operations.

Recognize closed its second fund, Recognize Partners II, with commitments totalling $1.7 billion, surpassing the $1.3 billion raised for its debut fund. Founded in 2020, the firm specialises in backing mid-market technology services companies, particularly those driving digital transformation across industries.

Cinven launched a new mid-market private equity fund, Cinven Strategic Opportunities Fund II, targeting between EUR 1.5 billion and EUR 2 billion. With fundraising starting in June, the new vehicle focuses on financial and tech-enabled services, marking a strategic evolution from Cinven 2022 Strategic Financials Fund.

Morgan Stanley Capital Partners closed its latest private equity fund, North Haven Capital Partners VIII, at $3.2 billion, exceeding the original $2.5 billion target and the $3.0 billion hard cap. The fund closed on 23 June 2025, less than a year after its first close in Q3 2024, and focuses on US middle-market investments.

BharCap Partners, which spun out of Pine Brook Partners in 2020, closed its second financial services-focused fund, raising $1.1 billion in total commitments, a 50% increase over its debut fund. The capital pool comprises $652 million in primary fund commitments alongside an additional $460 million in co-investment capital.

Seaside Equity Partners is in the final stages of raising two new US buyout vehicles with a combined target of $720 million. The vehicles, Seaside Equity Partners III and Navigator I, continue the San Diego firm focus on US lower-middle-market transactions, primarily targeting founder-led businesses across business services, industrials and healthcare.

Marlin Equity Partners closed Marlin Heritage Europe III at its EUR 1 billion hard cap, marking a significant step in its European expansion strategy. The fund was oversubscribed and raised more than 50% above its predecessor, continuing Marlin focus on high-potential European software, technology and services companies.

Ares Management closed its inaugural Japan DC Partners I LP, raising $2.4 billion. The fund is underwriting the development of three campus-style data centres in Greater Tokyo, delivering nearly 240 MW of IT load powered by renewable energy and innovative cooling systems, deploying capital alongside CPP Investments and GLP.

Neuberger Berman closed NB Strategic Capital Fund II, a GP-led secondary vehicle, with over $4 billion raised, surpassing the $2.5 billion target and significantly exceeding its $955 million predecessor closed in 2020. Neuberger has already executed more than 40 continuation deals worth a combined $15 billion.

Yves Blechner, the veteran credit investor from Man GLG, BlackRock and Davidson Kempner, is launching a new hedge fund named 44 Hill Capital Management in London. The fund will focus on global credit opportunities including high-yield, special situations and distressed debt, aiming to raise $500 million by November 2025.

Paris-based Tikehau Capital launched an Article 8 private equity fund, Tikehau Defense et Securite, under the EU Sustainable Finance Disclosure Regulation. Structured as a Specialized Professional Fund under ELTIF 2.0, the strategy targets investments across defence, cybersecurity and homeland security in Europe, backed initially by three insurers each committing EUR 50 million.

With investor demand for private credit surging, projected to reach nearly $2.8 trillion by 2028, Ares Management has launched its European Strategic Income ELTIF under the EU revamped ELTIF 2.0. The semi-liquid vehicle gives high-net-worth investors access to the Ares EUR 77 billion European direct lending platform, with lower entry thresholds than traditional funds.

As private credit cements its role in mainstream infrastructure financing, Apollo Global Management is stepping in with a £4.5 billion unsecured loan to support the Hinkley Point C nuclear power plant in the UK, filling the gap left by China departure in 2023. The scope of the deal underscores the expanding reach of private credit into large-scale strategic energy projects.

The UBS Unified Global Alternatives platform and Carlyle Group partnered to launch a new open-ended private equity secondaries fund targeting high-net-worth and wealth management clients. The fund offers quarterly liquidity and combines Carlyle AlpInvest global secondaries expertise with the UBS distribution network.

According to the BlackRock Family Office Report 2025, family offices continue to show a strong appetite for alternative assets, which now make up 42% of their portfolios, up from 39% in the previous survey. Private credit and infrastructure are gaining momentum, with 32% and 30% of family offices respectively planning to increase allocations over 2025 to 2026.

Citco-administered hedge funds recorded net inflows of $6.0 billion in May, one of the strongest monthly fundraising periods in recent years. Gross subscriptions totalled $17.4 billion with redemptions at $11.4 billion. Multi-strategy vehicles accounted for the bulk of inflows at $7.3 billion, while global macro and emerging markets saw net outflows.

A group of crypto-focused hedge fund figures are looking to raise $100 million for a new fund designed to invest in the Binance BNB token. The fundraise is led by Patrick Horsman, Joshua Kruger and Johnathan Pasch, who are looking to capitalise on growing institutional interest in digital asset ecosystems.

Anthony Pompliano raised $1 billion to launch ProCap Financial, a Bitcoin treasury firm, through a merger with SPAC Columbus Circle Capital. The deal includes $500 million in equity, a $250 million convertible note and plans to hold up to $1 billion in Bitcoin on the balance sheet, gaining immediate public market access through the SPAC structure.

On 3 June 2025, the FCA published what it trusts will be its final word on a topic discussed many times before. The Enforcement Guide has been updated and streamlined, reduced by over 250 pages according to the regulator. The Policy Statement confirms a shift towards assertive supervisory action, with enforcement cases being more selective and targeted.

On 19 June 2025, the FCA announced that it had secured convictions against two siblings, Redinel Korfuzi and Oerta Korfuzi, for insider dealing and money laundering offences which netted them over £1 million. Redinel Korfuzi was employed as a research analyst at an asset management firm and regularly gained confidential, price-sensitive information.

The Securities and Exchange Commission, now under Republican leadership, has formally withdrawn fourteen proposed rulemakings that originated under former Chair Gary Gensler between March 2022 and November 2023. Any future rulemaking on these topics must start from scratch with a new proposal and public comment period.