lev-os Preparing Secondary Market Reports
Synthesizes secondary market activity with volume trends, pricing benchmarks, and deal type composition for market participants.
When To Use
- Producing periodic (quarterly/annual) secondary market overview reports for LPs, GPs, or advisory clients
- Benchmarking secondary transaction pricing against historical NAV discounts/premiums
- Analyzing deal-type composition shifts (LP-led vs. GP-led continuation vehicles, directs, tenders, strip sales)
- Tracking market volume trends to inform portfolio allocation or disposition timing
- Preparing pitch materials or market context sections for secondary fund marketing
Inputs To Gather
- Reporting period: Quarter(s) and/or year(s) covered
- Transaction data: Closed deal volume, pricing (bid/ask and closing), deal count by type
- Pricing benchmarks: Average bid as % of NAV by strategy (buyout, venture, real assets, credit, infrastructure)
- Deal-type breakdown: LP portfolio sales, GP-led continuation vehicles, direct secondaries, tender offers, structured/preferred equity, fund restructurings
- Fundraising data: Secondary fund closings, capital overhang, dry powder estimates
- Comparable period data: Prior quarter and prior-year-period figures for trend analysis
- Notable transactions: Marquee deals, record-setting transactions, or structurally novel deals worth highlighting
- Source attribution: Greenhill/Jefferies, Evercore, Lazard, Setter Capital, industry databases, or proprietary data — identify each source clearly
- Audience and scope: Who will consume the report and what level of granularity is expected
Workflow
Define scope and periodicity
- Confirm reporting period, audience (internal investment committee, LP advisory board, external marketing), and depth of analysis required
- Determine whether the report is a standalone market update or a section within a broader fund report
Aggregate and normalize data
- Collect transaction volume from multiple sources; reconcile discrepancies in reported totals [VERIFY that source methodologies are consistent — e.g., some advisors include unfunded commitments in volume, others do not]
- Normalize pricing data to a common basis (% of NAV at transaction close vs. at reference date)
- Segment deals by type: LP-led (portfolio sales, single-fund strips, stapled transactions), GP-led (continuation vehicles, tender offers, NAV loans reclassified as secondaries)
Analyze volume and pricing trends
- Compare current-period volume to trailing quarters and the same period in prior years
- Calculate average pricing by strategy bucket; note dispersion (median vs. mean, interquartile range if data permits)
- Identify directional shifts: Are GP-led transactions growing as a share of total volume? Is venture pricing compressing while buyout holds? Are bid-ask spreads narrowing?
Assess deal-type composition
- Break out LP-led vs. GP-led share of total volume (by dollar amount and deal count)
- Within GP-led, distinguish single-asset continuation vehicles from multi-asset/portfolio CVs
- Note emerging structures: preferred equity secondaries, NAV-based lending overlaps, co-invest strip sales, deferred payment mechanisms
Contextualize with fundraising and dry powder
- Report secondary fund closings in the period and capital overhang relative to annual transaction volume
- Assess supply/demand dynamics: Is dry powder creating pricing pressure? Are LP sellers pulling back due to improved pricing?
Draft the report
- Executive summary: Key headline figures — total volume, average pricing, dominant deal type, notable shift vs. prior period
- Volume overview: Table or chart-ready data showing period-over-period comparisons
- Pricing analysis: Strategy-level pricing table with NAV discount/premium, trend arrows, and commentary on outliers
- Deal-type composition: Pie chart or stacked bar data with narrative on structural trends
- Notable transactions: 3–5 marquee deals with brief descriptions (counterparties anonymized unless public)
- Market outlook: Forward-looking commentary on expected volume trajectory, pricing direction, and structural evolution
Review and finalize
- Cross-check all figures against source data; ensure internal consistency (segment volumes sum to total)
- Confirm source attribution is complete and dates are accurate
- Verify that forward-looking statements are appropriately qualified
Output
A structured secondary market report containing:
- Executive summary with headline metrics
- Volume trend analysis with period-over-period comparison (tables/chart-ready data)
- Pricing benchmarks by strategy with historical context
- Deal-type composition breakdown (LP-led, GP-led, direct, structured)
- Fundraising and dry powder context
- Notable transaction highlights
- Market outlook with qualified forward-looking commentary
- Full source attribution and methodology notes
Quality Checks
- All volume and pricing figures reconcile across sections and sum correctly
- Pricing is expressed on a consistent basis (% of NAV) with reference date specified
- Deal-type categories are mutually exclusive and collectively exhaustive — no double-counting
- Sources are cited for every data point; proprietary estimates are labeled as such
- Prior-period comparisons use the same methodology and source vintage [VERIFY if source revised historical figures]
- Forward-looking statements use hedging language ("we expect," "market participants anticipate") and are clearly distinguished from reported data
- Report is calibrated to audience — internal reports may include proprietary deal flow data; external reports should anonymize where required
- Any data gaps or known limitations are disclosed (e.g., "GP-led volume may be understated due to delayed reporting of continuation vehicles")