In today's edition, Side Letter covers European GP stakes, portfolio stress measurement, and a GP's deeper push into the Middle East. Fresh Insights highlights BNPP's Christory arguing that European GP stakes remain undercapitalised.

GP stakes has evolved over the past decade from something of a niche to an established strategy in its own right, with its continued growth seemingly putting paid to historic concerns that dealflow would ultimately prove limited. The strategy's maturation reflects broader institutional appetite for exposure to private equity economics without direct fund commitments.

Market participants note that despite increased competition, the pipeline remains robust as more GPs seek permanent capital solutions. Christory's assessment suggests significant room for expansion across European markets, where penetration lags behind US counterparts.

Investors continue to monitor portfolio stress indicators closely as macroeconomic uncertainty persists, with GP stakes offering a differentiated risk-return profile compared to traditional fund investments.