Private Market Selection: Why Secondaries and Private Debt Lead the Way in 2026

The private markets landscape is undergoing a fundamental shift. As traditional exit routes remain congested and interest rate environments stabilize at higher levels, asset allocators are being forced to rethink their approach to illiquidity.

Insight from the Citywire Private Markets DACH Retreat Munich 2025

Recently, Citywire Switzerland sat down with Dr. Marie-Laure Mikkelsen, founding partner of Alfinas Alternative Investment Partners, during the Citywire DACH Retreat held at the prestigious Althoff Seehotel Überfahrt in Tegernsee, Munich on November 26-28.

As Citywire playfully framed it:

"Dr. Marie-Laure Mikkelsen gifts some private market insights in time for Christmas. So don't look a gift horse in the mouth, rummage past the tangerine to the bottom of the stocking, and take a look now!"

Executive Summary: Key Strategic Takeaways

Insights from Dr. Mikkelsen’s Interview at the Citywire DACH Private Markets Summit

• The Secondary Evolution: Moving from a liquidity valve to a dynamic portfolio tool for tactical rebalancing and J-curve mitigation.

• Private Debt Precision: Shifting focus toward senior secured positions and covenant strength within the capital structure.

• From Products to Solutions: Moving beyond the investment team to scrutinize financial modeling and back-office resilience.

• Compensated Illiquidity: Ensuring Alpha is derived from managed structural risk rather than legacy valuations.

Dr. Mikkelsen’s Strategic Analysis: The Deep Dive

Beyond the surface-level trends, we explored where the real "Alpha" is hidden and why the relationship between asset managers and allocators must evolve.

1. The Maturation of the Secondary Market: From Liquidity Valve to Strategic Tool

Historically, the secondary market was viewed as a "discount window" for investors needing an emergency exit. Today, that narrative has completely changed. As an OCIO, Alfinas views the secondary market as a dynamic portfolio construction tool.

• Tactical Rebalancing: It allows allocators to actively manage their "denominator effect" and vintage concentration.

• J-Curve Mitigation: By acquiring interests in mature funds, investors can accelerate distributions and mitigate the early-year "J-curve" drag.

• The Opportunity: In 2026, we see a unique window where high-quality assets are available at attractive entry points driven by systemic liquidity needs.
  

2. Private Debt: Precision in the Capital Structure

Private Debt remains a cornerstone for yield, but the "low-hanging fruit" of simple direct lending is gone. To capture exceptional risk-adjusted returns today, Dr. Mikkelsen believes one must navigate the entire capital structure with precision. The focus has shifted toward senior secured positions and specialty finance where protection is paramount.

Key considerations include Covenant Strength, which separates resilient portfolios from vulnerable ones, and Downside Protection, focusing on the margin of safety provided by the underlying collateral rather than just the nominal yield.

3. Bridging the Gap: Moving from "Products" to "Solutions"

A major gap in the market is the misalignment between what asset managers sell and what investors actually need. Many managers are still stuck in a "product-push" mindset. Dr. Mikkelsen’s challenge to asset managers is to become solution providers.

This requires a deeper level of due diligence: during the interview, she emphasized that investors shouldn't just focus on the investment team. Alfinas advises looking closely at the financial modeling and the back office. How does the manager handle trades or operational issues? True Alpha in 2026 comes from operational transformation and granular transparency, not just financial engineering.

4. Risk Management: Making Illiquidity a Compensated Choice

Illiquidity must always be a deliberate, compensated strategy. Alfinas is currently paying close attention to "legacy" valuations—assets held in funds from the 2019-2021 era that may not have fully adjusted to current market realities.

A disciplined OCIO ensures that every basis point of illiquidity premium is justified by a rigorous assessment of the underlying asset's exit potential and cash-flow reliability. As Dr. Mikkelsen warned, private market alpha is often derived from structural risk; managing that risk correctly is what defines a successful allocation.

Watch the full interview: You can view the full discussion and "unwrap" these Key Strategic Takeaways in the original editorial article on the Citywire platform here:

👉 Zurich specialist unwraps private market selection priorities

Elevate Your Strategy: Exclusive Access: Request the 2026 Strategic Analysis Report

Beyond the interview insights, Alfinas has developed a proprietary strategic brief for our professional partners. This internal document provides a technical deep-dive into our 2026 Methodology, including:

• Secondary Entry Points: Advanced timing and selection frameworks.

• Capital Structure Precision: Proprietary positioning in Private Debt.

• Operational Due Diligence: The "Alfinas Framework" for back-office and modeling resilience.

To protect our strategic IP, this report is reserved for qualified institutional allocators and family offices and is available exclusively upon request.

[Request the 2026 Strategic Analysis Report] (Please include your full name, firm, and professional title to verify your request)

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Consultation & Advisory

Dr. Mikkelsen provides bespoke strategic reviews for institutional allocators looking to navigate the structural risks of the 2026 landscape.

For formal inquiries regarding OCIO mandates, portfolio positioning, or private debt strategy, please engage via our [Contact Page] or connect directly with Dr. Mikkelsen on LinkedIn.