KKR
The latest research and outlooks in the ProAllocate library
- Fixed Income
Let There Be Compute!
KKR argues the AI capex buildout requires new scaled financing channels beyond hyperscaler balance sheets, warning that shared counterparties across equity, debt and infrastructure create hidden concentration risk. It contends credit market discipline—covenants, collateral analysis and underwriting—will determine whether the AI investment boom becomes a durable market.
- Private Markets
The Case for Asia Private Equity
KKR argues that Asia's diverse structural shifts—rising middle-class consumption, intra-regional trade, governance reform and digital infrastructure gaps—create differentiated private equity opportunities still underrepresented in portfolios concentrated on North America and Europe.
- Fixed Income
Re-Mapping the Opportunity in Asia Credit
KKR argues Asia liquid credit has evolved into a predominantly investment-grade, sovereign-anchored, developed-market asset class that has outgrown its emerging markets classification. It contends the market offers similar returns to EM IG credit with far lower volatility, warranting its own dedicated allocation rather than being folded into EM mandates.
- Macro
Flash Macro: U.S. FOMC September 2026
KKR argues the Fed's 25bp hike reflects a normalization 'adjustment cycle' rather than a 2021-style tightening cycle, consistent with its Regime Change thesis of persistently elevated inflation and nominal growth. It now expects two more hikes, rates held near 4.375% through early 2029, and raises its 10-year Treasury yield targets.
- Private Markets
Asia Real Estate: Leaning Into Structural Themes in a Higher-Rate World
KKR argues Asia Pacific real estate returns now depend on structural value creation rather than cap-rate compression amid higher-for-longer rates, favouring Japan's corporate carve-outs, Korean logistics, and Australian specialty living and cold storage.
- Macro
Flash Macro: U.S. Jobs Report July 2026
A weak July 2026 U.S. jobs report tones down fears the Fed is behind the curve, supporting a 'long hold' baseline. Despite softening labor data, strong earnings, capex and productivity should propel equities higher in 2026, albeit with more volatility.
- Fixed Income
High Yield's Second Act: What AI Revealed About Credit Quality
The article argues that today's global high yield market has structurally improved—record BB-rated composition, low duration, high secured seniority, and minimal software exposure—making it a more compelling risk-adjusted proposition than leveraged loans and direct lending. It contends issuers are increasingly shifting to bonds for financing certainty, signaling a structural reallocation opportunity.
- Macro
Flash Macro: U.S. FOMC July 2026
Following Warsh's second Fed meeting, KKR reads a hawkish tilt favoring market-driven tightening. Their models point to fed funds in the low-to-mid 4% range by late 2026, supporting a modest tightening bias, higher yields, and continued equity gains amid greater volatility.
- Portfolio Construction
The Total Portfolio Approach: The Dog Has Caught the Bus
The note distils client conversations on implementing the Total Portfolio Approach (TPA), arguing it is not a single blueprint but adaptable core principles akin to zero-based budgeting for portfolio construction. It addresses practical questions on asset allocation, risk factors, and Private Markets implementation as return dispersion rewards better capital allocation.