Gatekeepers Have Spoken: It’s Bonds and Private Credit

The numbers tell the story: 43% of gatekeepers expect higher returns from public fixed income and 37% say they will increase allocation to the asset class in the next 12 months. Within Asia, 65% and 61% of gatekeepers will increase allocations to government bonds and investment grade credit respectively. There’s a similar trend in private credit, with 39% of all surveyed gatekeepers intending to increase exposure to the asset class in the same period.

A new public-private powerhouse arrives

The findings echoed PGIM’s own strategic vision. In June 2025, PGIM announced the merge of its public fixed income and private credit teams into a US$1.1 trillion credit platform. The unified credit business aims to offer investors more tailored solutions that encompass both public and private credit across geographies, issuer types and maturities, reflecting a growing trend of convergence between the two asset classes that also extends to structured credit. 

Jones cites securitised credit as a case in point. Some 50% of the gatekeepers in this year’s PGIM survey see the current democratisation of what was once regarded as an exclusively institutional asset class as beneficial for private wealth investors. 

“CLOs, in particular, are gaining more traction with private wealth clients,” says Jones, “The total CLO market size reached $1.4 trillion in early 2025, driven by favourable capital treatment and floating-rate appeal. We think an actively managed global AAA CLO strategy will provide new and unique access to high-quality securitised solutions, and could potentially generate more diversified sources of yield.”

Managing the downside as important as exploiting the upside

PGIM’s recent integration of public fixed income and private credit teams also extends and more closely aligns the firm’s multiple antennae of risk awareness and monitoring. This comes at a time when gatekeepers are themselves recalculating and repricing risk and expressing a far greater affinity for liquidity as a result. 

Again, the numbers are clear. Over 90% of fund selectors in the Gatekeeper Pulse survey say that risk management is now as important to them as managers’ track records. That’s even more pronounced when they appraise alternatives providers. This implies, in turn, a realisation that enduring risk management muscle memory can only be built over decades of hard-fought experience of up- and down-cycles of all kinds.

PGIM’s history and heritage as a fabled generator of credit solutions stand it in good stead in this regard. It has been active in private credit lending since 1925 and in public fixed income investment since the very early 1900s.

Alternatives and AI ascendant

Fund selectors are also planning to continue increasing their overall allocations to private markets in the year ahead. A total 66% of participating selectors said that wider access to liquid alternatives would create another positive inflection in private market investment.  

If gatekeepers are unambiguous about their intentions to scale up in alternatives, they are equally emphatic about their preferred thematic investments for the coming year. Artificial intelligence (AI) and AI-related investments are the comfortable winners. In Asia, for example, 73% of fund selectors consider AI either a high or a medium priority. 

“AI and its implications have become prevalent influences on gatekeeper perceptions this year,” says Jones. “Whether it’s in healthcare innovation, data centres, cloud infrastructure, cyber data security or the longevity revolution for aging populations, the advances that AI is enabling and accelerating are dominating fund selectors’ investment preferences when it comes to thematics.”

REITs are back

If there was one striking readmission to Asia-based gatekeepers’ good books in this year’s survey, it was REITs. Some 55% of respondents indicated plans to increase allocations to the asset class. A combination of low valuations, clear diversification benefits and steady income streams explains the renewed bullishness.

“REITs are trading at historic discounts to equities at a time when new development is constrained by higher borrowing and construction costs,” says Jones, “The current valuations present a compelling entry point for investors seeking high-quality real assets.”

Explore the full insights from PGIM’s 2025 Gatekeeper Pulse® survey.