Fees appear to be entering a new downward phase, with pricing pressure that has long characterised public markets now spreading into private markets, according to research by bfinance.
Drawing on manager search data, fee analysis and a limited partner survey, bfinance identified cost reductions across several asset classes since the early 2020s.
Within public markets, the median quoted fee discovered in the process of bfinance searches for global emerging market pooled equity funds ($100m allocations) has fallen by approximately 13 per cent, from 69 basis points (bps) in 2021-22 to 60 bps in 2025-26. Although the consultancy has observed pricing pressure in global equities, the factors driving this are more nuanced, both from the perspective of the funds being promoted, and investor demand.
Meanwhile, there was a 12 per cent decline in the median quoted fee for European high yield credit separately managed accounts ($100m allocations) between 2020-22 and 2025-26, from 34 bps to 30 bps.
In private markets, more than two-thirds of LPs polled in a global fees survey as part of the analysis noted considerable fee reductions in direct lending strategies over the past three years. In addition, nearly half cited reductions in infrastructure and real estate, while 39 per cent noted lower private equity fees.
Olivier Cassin, managing director at bfinance, says: “Fee declines in the 2010s were largely driven by public market passive competition, smart beta adoption, and the low-rate environment. Today’s pricing pressures are more closely linked to private markets performance challenges, fundraising difficulties, and evolving competitive dynamics.”
In addition, the report found a widening gap between investor segments. Large, established institutional allocators were best positioned to benefit from enhanced negotiating leverage, while smaller institutions and newer wealth-sector entrants having less access to favourable terms.