Evergreen & Secondaries: When flexibility meets liquidity

Published on
9 October 2025
Read time
2 minute(s) read

Private equity has long been characterised by locked-up capital and a patience-testing wait for returns. Whilst these features support value creation, they often clash with investors’ demand for flexibility and efficient capital deployment. Two powerful trends have emerged from this demand: the evergreen (or open-ended) fund structures and secondaries.

Both trends address specific investor challenges. While evergreen structures broaden access to private equity and offer immediate exposure to a diversified portfolio, rapidly expanding secondaries represent an ideal asset class offering near-term liquidity potential while mitigating the J-curve effect (in particular, LP-led secondaries). Together, these converging trends are highly complementary: they form a solid tandem that is reshaping the way investors engage with private equity.

Why secondaires suit an evergreen structure

LIQUIDITY MANAGEMENT:

Evergreen funds must be carefully managed to accommodate periodic redemptions despite holding inherently illiquid assets. To respect potential redemptions, managers are forced to maintain a certain level of cash or highly liquid assets, which, if not properly managed, could create a structural drag on returns.

By integrating secondaries, evergreen vehicles can rely on mature assets with shorter residual lives and more predictable near-term distributions. These assets have the potential to offer near-term liquidity because they are further along in their value creation phase and closer to the end of their managers’ tenure, and hence exits or realisations.

COMPOUNDING EFFECT:

Evergreen structures are designed to naturally facilitate reinvestment. When an investment is sold, the proceeds are not returned to investors but are immediately redeployed into new opportunities, allowing potential profits to generate further profits - the very essence of compounding.

Secondary strategies amplify this dynamic: since assets acquired later in their life cycle tend to distribute cash more quickly, managers can reinvest these proceeds into new secondary opportunities. Theoretically, this shortens the reinvestment cycle, keeping capital actively deployed at high returns, which could accelerate compounding and create a virtuous cycle of continuous growth.

BOOSTING DIVERSIFICATION AND IMMEDIATE ACCESS:

Diversification is another key advantage of combining evergreen and secondary strategies, especially for LP-led focused strategies. Evergreen funds already provide investors with immediate exposure to diversified portfolios, unlike closed-end funds that gradually build holdings over several years, leaving investors exposed to blind pool risk and higher concentration early in the fund’s life cycle.

When secondaries are layered into an evergreen structure, this diversification benefit is boosted. A single LP-led secondary transaction typically involves acquiring a portfolio which may hold dozens of underlying companies. As a result, investors gain instant exposure across managers, vintages, sectors, regions, and strategies.

This level of granularity and breadth in diversification is difficult to replicate through primary commitments or direct investments alone. For investors, it means faster access to a diversified portfolio achieved from a single entry point.

A strategic and opportunistic approach

The convergence of evergreen structures and the secondary market represents significant progress for private equity. By combining the liquidity profile of secondaries with the reinvestment mechanics of evergreen funds, investors can achieve a more efficient, diversified exposure to private equity whilst benefitting from more flexibility and control.

While this tandem is powerful, execution matters. Managers may fall into the trap of using secondary markets solely for their attractive entry discounts, neglecting the quality of investments, which could affect long-term profitability. Likewise, inadequate management of the liquidity component can jeopardise the effectiveness of the structure.

That’s why, at Carmignac, our rooted active management plays a key role, entailing not only skilled investment selection but also careful portfolio monitoring and liquidity management, leveraging over 30 years of expertise in public markets. This way, we ensure that Carmignac Private Evergreen stays true to its objective of offering flexibility and control.

The results are already visible: since inception on 15 May 2024, secondary investments have generated liquidity equivalent to 23%1 of our investments in Private Assets (Distributions to Paid In or “DPI”), helping us both meet redemptions and reinvest seamlessly. At the same time, performance since inception has been driven as much by fundamental value creation as by entry discounts – demonstrating the solid foundation of the fund’s strategy.

1Source: Carmignac, August 2025. Past performance is not necessarily indicative of future performance. Performances are net of fees (excluding possible entrance fees charged by the distributor). The return may increase or decrease as a result of currency fluctuations.

Carmignac Private Evergreen

Granting privileged access to diversified private equity opportunities
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Carmignac Private Evergreen A EUR ACC

ISIN: LU2799473124
Recommended minimum investment horizon
5 years
Risk indicator*
6/7
SFDR - Fund Classification**
Article 8

*Risk Scale from the KID (Key Information Document). Risk 1 does not mean a risk-free investment. This indicator may change over time. **The Sustainable Finance Disclosure Regulation (SFDR) 2019/2088 is a European regulation that requires asset managers to classify their funds as either 'Article 8' funds, which promote environmental and social characteristics, 'Article 9' funds, which make sustainable investments with measurable objectives, or 'Article 6' funds, which do not necessarily have a sustainability objective. For more information please refer to https://eur-lex.europa.eu/eli/reg/2019/2088/oj.

Main risks of the fund

Liquidity: Should exceptionally large redemptions be made, forcing the Fund to sell, the illiquid nature of assets might require the Fund to liquidate assets at a discount in particular under unfavorable conditions such as abnormally limited volumes or unusually wide bid-ask spreads.
Valuation: The valuation method, which is partly based on accounting data (quarterly or semi-annually computed), and the difference in lag with which NAVs are received from the General Partners, could reflect impacts on NAV with a delay. Moreover, NAV is sensitive to the valuation methodology adopted.
Discretionary Management: Investors rely solely on the discretion of the Portfolio Managers, and the level of transparency of the information available, to select and realize appropriate investments. There is no guarantee in the ultimate success of investments.
Limited control over secondary investments: Where the Fund makes an investment on a secondary basis, the Fund will generally not have the ability to negotiate the amendments to the constitutional documents of an underlying fund, enter into side letters or otherwise negotiate the legal or economic terms of the interest in the underlying fund being acquired. The underlying funds in which the Fund will invest generally invest wholly independently.
The Fund presents a risk of loss of capital.

Fees

ISIN: LU2799473124
Entry costs
4.00% max. of the amount you pay in when entering this investment. This is the most you will be charged. Carmignac Gestion doesn't charge any entry fee. The person selling you the product will inform you of the actual charge
Exit costs
5.00% Max. of your investment before it is paid out to you. 5% could be the maximum amount that may be charged to you. For A and I share classes, additional 5% could be the maximum amount that may be charged to you as the Early Redemption Fees if you request to redeem
your Shares within eighteen (18) months of the launch of the Sub-Fund.
Management fees and other administrative or operating costs
2.60% of the value of your investment per year. This estimate is based on actual costs over the past year.
Performance fees
15.00% of the Sub-Fund's positive returns subject to a five per cent (5%) Hurdle Rate. The real amount varies according to the
performance of your investment.
Transaction Cost
0.03% of the value of your investment per year. This is an estimate of the costs incurred when we buy and sell the investments underlying the product. The actual amount varies depending on the quantity we buy and sell.

Performance

ISIN: LU2799473124
Carmignac Private Evergreen24.80.1
Carmignac Private Evergreen+ 4.2 %-+ 17.5 %

Source: Carmignac at 30 Sep 2025.
​Past performance is not necessarily indicative of future performance. Performances are net of fees (excluding possible entrance fees charged by the distributor).

Reference Indicator: N.A.

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MARKETING COMMUNICATION. Please refer to the KID/KIID/prospectus of the fund before making any final investment decisions.
The decision to invest in the promoted fund should take into account all its characteristics or objectives as described in its prospectus. This document may not be reproduced, in whole or in part, without prior authorisation from the management company. It does not constitute a subscription offer, nor does it constitute investment advice. The information contained in this document may be partial information and may be modified without prior notice. The Management Company can cease promotion in your country anytime. Investors have access to a summary of their rights on the following link (paragraph 5): https://www.carmignac.com/en/regulatory-information. The Sustainable Finance Disclosure Regulation (SFDR) 2019/2088 is a European regulation that requires asset managers to classify their funds as either 'Article 8' funds, which promote environmental and social characteristics, 'Article 9' funds, which make sustainable investments with measurable objectives, or 'Article 6' funds, which do not necessarily have a sustainability objective. For more information, please refer to https://eur-lex.europa.eu/eli/reg/2019/2088/oj. Reference to certain securities and financial instruments is for illustrative purposes to highlight stocks that are or have been included in the portfolios of funds in the Carmignac range. This is not intended to promote direct investment in those instruments, nor does it constitute investment advice. The Management Company is not subject to prohibition on trading in these instruments prior to issuing any communication. The portfolios of Carmignac funds may change without previous notice. Past performance is not necessarily indicative of future performance. Performances are net of fees (excluding possible entrance fees charged by the distributor). The return may increase or decrease as a result of currency fluctuations. Carmignac Private Evergreen refers to the Private Evergreen sub-fund of the SICAV Carmignac S.A. SICAV – PART II UCI, registered with the Luxembourg RCS under number B285278. Access to the Fund may be subject to restrictions with regard to certain persons or countries. The Fund may not be offered or sold, directly or indirectly, for the benefit or on behalf of a U.S. person, according to the definition of the US Regulation S and/or FATCA. The Fund presents a risk of loss of capital. The risk, fees and ongoing charges are described in the KIDs (Key Information Document). The Fund's respective prospectuses, KIDs, NAV and annual reports are available at www.carmignac.com, or upon request to the Management Company. The KIDs must be made available to the subscriber prior to subscription. In Switzerland, the Fund’s respective prospectuses, KIDs and annual reports are available at www.carmignac.ch, or through our representative in Switzerland, CACEIS (Switzerland), S.A., Route de Signy 35, CH-1260 Nyon. The paying agent is CACEIS Bank, Montrouge, succursale de Nyon/Suisse, Route de Signy 35, 1260 Nyon. The KID must be made available to the subscriber prior to subscription. In the UK, the Funds’ respective prospectuses, KIDs and annual reports are available at www.carmignac.co.uk, or upon request to the Management Company. This material was prepared by Carmignac Gestion, Carmignac Gestion Luxembourg or Carmignac UK Ltd and is being distributed in the UK by Carmignac Gestion Luxembourg.