Understanding private markets
Private markets give you the opportunity to invest in innovative businesses and projects that aren’t yet listed on public stock exchanges. This might include for example, investments in renewable energy, infrastructure, forestry or young companies working on new ideas that could help the economy grow.
We’re adding private market investments to our main workplace pension default funds including Universal Balanced Collection and Aegon LifePath.
A default is simply the fund your pension savings go into automatically, if you don't make your own investment choice. Adding private markets aims to improve long-term growth potential, balance risk across a mix of investments and give you access to new types of investments.
Potential benefits
A wider mix of investments – helps reduce risk because you're less reliant on the success or otherwise of each individual type of investment.
Potential for stronger long-term growth – private markets often include fast-growing companies and projects which may offer stronger growth over time than publicly listed companies. However, higher returns aren't guaranteed.
Access to new ideas and projects – including renewable energy, sustainable infrastructure and forestry, which can also support positive environmental and social outcomes.
Potential risks
Values can rise and fall more sharply - some private market investments can rise and fall in value more than listed investments, particularly in the short term.
They can take longer to sell - especially in extreme market conditions. In our default funds, they sit alongside a broad range of more easily traded assets. This helps to make sure you can access your savings whenever you need to.
Specialist expertise is required - these investments can vary widely, so we work with experienced teams who carefully select and manage them on your behalf.
As with all investments, their value can go down as well as up and scheme members may get back less than they invest.
Types of private markets
Private markets cover a broad range of investments, including things like growing businesses, loans to companies, infrastructure projects, forestry, or property. What they all share is that they’re not bought and sold on a stock exchange. Instead, they involve investing directly in businesses or projects that operate outside the public markets.
Private equity means investing in companies that aren’t listed on public stock markets. These are often established businesses that specialist fund managers believe can grow, improve or operate more efficiently with the right support. Fund managers work closely with each business, helping them expand, develop new ideas or strengthen how they operate.
As the business becomes more valuable, your pension savings can benefit. Private equity can offer strong long‑term growth potential because these companies often develop and transform over several years.
Here’s an example of a private equity investment.
Biotechnology company developing new cancer treatments
This investment supports a young biotechnology company working on promising new ways to treat cancer. The company uses a person’s own cells, strengthening them so they can help the body fight cancer more effectively.
With extra funding, the business has been able to make these treatments much quicker and cheaper to produce. It has cut manufacturing costs by around 60% and can now prepare treatments up to ten times faster than before. These improvements have helped the company secure a major agreement with a large pharmaceutical partner, who has committed to buying a significant amount of its products.
If the business continues to grow and its treatments become more widely used, it could increase in value over time, which can help support long‑term growth in your pension savings.
Private credit simply means lending money directly to private businesses rather than buying their shares. These loans help companies grow, invest in new projects or manage their finances more effectively. Fund managers carefully choose strong, reliable businesses and structure the lending in a way that aims to protect your interests.
Private credit can provide a steady stream of income, as businesses make regular interest payments over the life of the loan. These payments aren’t guaranteed and can be affected if a business struggles or economic conditions change.
Here’s an example of a private credit investment.
Financing the world’s largest offshore wind farm
This private credit investment helped fund a major offshore wind farm in the North Sea , one of the largest clean‑energy projects ever built. When fully operational, it is expected to produce enough renewable electricity to power around six million homes each year, which is more than twice the number of homes in Scotland.
By providing financing, investors played an important role in getting this large‑scale project off the ground. In return, private credit investments like this aim to deliver steady, reliable returns generated from regular loan repayments.
As the wind farm begins supplying energy, the project can grow in value, helping support the long‑term growth of your pension savings while contributing to a more sustainable future.
Infrastructure investment means supporting the essential services we all rely on, like transport networks, renewable energy, water systems and digital connections. These projects help keep everyday life running smoothly and improve quality of life for communities.
For your pension, infrastructure can provide steady, long‑term income because many projects earn money in predictable ways, such as payments for using energy or transport services. However, they can still be affected by changes in costs, regulations or demand and returns aren't guaranteed.
Here’s an example of an infrastructure investment.
Global infrastructure and transport network
This investment gives access to a fund that owns essential infrastructure around the world, including wind farms, data centres, shipping, rail networks and major structures like bridges.
Infrastructure investments like these aim to deliver steady, reliable returns. They’re often less affected by short‑term market falls, because the services they provide remain in high demand.
Over time, infrastructure can help support the growth of your pension savings while contributing to important projects that benefit communities and the wider economy.
Real estate means investing in the buildings and spaces that people and businesses rely on, including homes, offices, warehouses and healthcare facilities. These properties can earn regular rental income and often grow in value over time. Specialist fund managers select and oversee properties they believe can deliver stable, long‑term benefits.
Including real estate in a pension can offer steady income and long‑term growth, but this isn't guaranteed. Property values can rise or fall and may be affected by changes in the economy or rental demand.
Here’s an example of a real estate investment.
Investing in UK real estate
This investment gives access to a mix of residential, commercial and industrial property across the UK. One example is a major UK business park that supports over 250 local jobs and offers shops and leisure facilities for the community.
Investing across different types of property spreads risk and provides a range of income sources. Because real estate often behaves differently from investments like shares, it can help add balance within your pension over the long term.
Forestry means investing in sustainably managed forests that grow timber and support the natural environment. As trees grow, they naturally increase in value and harvested timber can be sold for everyday products.
Specialist fund managers select forests they believe can grow well over time, focusing on responsible stewardship and long‑term health. Because tree growth is steady and predictable, forestry can add an element of stability to pension savings over the long term.
Here’s an example of a forestry investment.
Investing in sustainable forestry
This investment gives access to an experienced global forestry manager with a long track record of looking after millions of acres of woodland. These forests are carefully managed and replanted to support long‑term growth and environmental benefits.
Forestry offers a rare chance to invest in a climate‑positive solution. As trees grow, they absorb carbon, helping to offset emissions. The forests also generate returns by supplying timber, and by selling carbon credits to organisations aiming to reduce their environmental impact.
Because forestry has several income sources, it often behaves differently from investments such as shares and bonds. This helps spread risk, and can provide some protection when other markets fall.
Find out how your fund is changing
We're adding private markets investments to our largest default funds, the Universal Balanced Collection and our Aegon LifePath funds.
Read more about what's changing and why.
Universal Balanced Collection
(Through Aegon Retirement Choices)
Aegon Lifepath
(Through TargetPlan and Aegon Master Trust)
Not sure if you're invested in these funds?
Log in to your workplace pension account to see what fund you're invested in.
Need help?
If you’re unsure what this means for you, you may want guidance or personalised advice from a financial adviser. Please note there may be a charge for this advice. If you don’t have a financial adviser, you can find one in your area by visiting MoneyHelper, or find out more about advice services supported by Aegon by visiting aegon.co.uk/origen.
Origen Financial Services Ltd is wholly owned by Aegon UK plc but operates independently to us.