I liked this take from Matt Levine on the forward-looking prospects of Private Equity. One way I tend to think about markets is that you have certain factors that persist in providing superior risk-adjusted returns across time. I tend to sort these into risk premia (equity, credit, duration, etc.) and style premia (trend, momentum, value, carry, etc.). No one is really sure why these work (I tend to lean on the behavioral explanations), but these have some empirical track record across multiple markets and multiple cycles and so it seems reasonable to expect those to persist. (Though some probably won't!) I think you can build a pretty good portfolio of just these things and be pretty confident that portfolio will do reasonably well over the long run. I tend to think of this as the 'core portfolio.' Don't get too clever, just stay the course with things that work. But the big fortunes in finance tend to be coming up with some new asset class or style and this is what the financial thrill books tend to be about. Junk bonds in the 80s, Russian equities in the 90s, crypto in the 2010s, etc. Someone 'finds' these new asset classes as there is something like a price discovery period where the rest of the market realizes it's a legitimate thing and money flows in. If you get into this early, you can benefit a lot from that price discovery. But, it doesn't seem to persist (and is sometimes a bubble). 5 years ago I was excited about crypto and 'micro' PE and I'm still somewhat excited about those but the word is certainly out on crypto, and it's pretty well out on the micro PE stuff as well. AI is the obvious next thing but it's not very clear to me in what way that's investable beyond investing in getting good at using it as a way of increasing your own human capital stock (which very much seems worth doing). 🤔