SEC Seeks Broader Retail Access to Private Markets

The Securities and Exchange Commission included “Enhancing Retail Exposure to Private Markets” in its 2026 Regulatory Agenda last week, signaling a push to make private investments more available to ordinary investors.

Last year the SEC relaxed a policy that had limited closed-end funds to 15% allocations in private investments, clearing the way for more registered products that hold private equity, private credit and private real estate.

Wealth managers and advisors say many retail investors already access private markets through SEC-registered interval funds and newly registered products such as Morgan Stanley’s PMAX funds. These vehicles can be bought through brokerage accounts rather than private-placement channels.

Interval funds typically hold private assets and offer periodic redemption windows instead of daily liquidity. The structure is intended to match the funds’ liquidity with the underlying, less liquid investments.

David Krakauer, vice president of portfolio management at Mercer Advisors, noted that recent regulatory changes have expanded access and that mutual funds and other registered vehicles now commonly include private equity, private credit and similar alternatives.

Morgan Stanley registered two PMAX funds, PMAX-Balanced and PMAX-Growth, removing the previous accredited-investor requirement. The funds still set minimum investments of $10,000 initially and $5,000 for subsequent contributions and limit withdrawals to once a quarter. Alison Nest, head of investment solutions products at Morgan Stanley, described fund structures that allow access while many underlying opportunities retain higher eligibility standards.

Financial technology firms and platforms are widening distribution. Envestnet said advisors using its systems can offer interval funds from large asset managers including BlackRock, Fidelity and Franklin Templeton. Todd Rais, head of investment products and services at Envestnet, said advisors and clients investing in these products need clear information about risks and operations.

Research data show assets in funds designed to give retail investors access to private markets rose about 120% to nearly $600 billion over the past four years.

Some large managers enforcing redemption limits in private credit funds over the past year have restricted investors’ ability to withdraw cash during market stress. Managers cited liquidity management needs when setting gates or limits.

Critics point to higher fees, limited transparency and withdrawal restrictions in semiliquid products. Krakauer cautioned that investors should not expect immediate access to all cash in funds that hold illiquid assets and said liquidity gates are often necessary to manage funds with private investments.

Christian Hennion, a partner at Katten Muchin Rosenman, said the SEC agenda implies regulators may seek to revise constraints under the Investment Company Act that make it harder for public funds to hold private assets.

Advisors say investor suitability and liquidity needs remain central when recommending private-market products. The new regulatory settings and product registrations expand formal access for retail investors, while those products continue to differ from publicly traded stocks and bonds in cost, reporting and redemption terms.