As non-bank institutions take on a greater role in providing and intermediating capital, NYLIM research examines the implications for market backstops and portfolio construction

New York Life Investment Management (NYLIM), a global asset management firm with approximately $838 billion in assets under management, announced the release of the 2026 edition of its annual Megatrends research report. This year’s report, The Next Era in Global Liquidity: An Architecture, finds that major developed economies are moving toward a more market-led liquidity regime, as non-bank financial institutions (NBFIs) and other market participants take on a greater role in providing and intermediating capital.

The shift is broadening the sources of liquidity across the financial system while making traditional market backstops less uniform. Unlike banks, NBFIs generally operate outside the formal, repeatable central-bank liquidity infrastructure available to the banking system. This raises new questions about where liquidity may come from during periods of market stress. In the U.S. Treasury market alone, private, non-official investors now hold roughly 60% of outstanding debt, up from 37% in 2014.

“Investors have traditionally thought about liquidity as a characteristic of an asset or investment vehicle. We believe it increasingly needs to be understood at the portfolio and financial-system level,” said Julia Hermann, Global Market Strategist at NYLIM. “A broader range of market participants are taking on functions once concentrated in banks and central banks. That creates new sources of flexibility, but also new questions about where liquidity comes from during periods of stress. Understanding that changing architecture can help investors think more holistically about portfolio construction, risk and the role liquidity may play in the next market cycle.”

Implications for investors

The report identifies several developments that illustrate how investors and markets are adapting to the evolving liquidity environment:

• Private markets are developing new liquidity tools, without changing the liquidity of the underlying assets. Secondaries, continuation vehicles and semi-liquid structures can provide additional ways to transfer exposures or access capital, but do not fundamentally change the liquidity characteristics of the underlying investments.
• Digital infrastructure may improve asset mobility—but mobility is not liquidity. Tokenization and stablecoin-based settlement can make ownership and collateral easier to transfer, but true market liquidity still depends on willing buyers and sellers, effective price discovery and the ability to transact without materially moving prices.
• Portfolio construction is increasingly incorporating liquidity across the total portfolio. The growing adoption of the Total Portfolio Approach reflects greater focus on managing risk and liquidity across investments rather than solely within traditional asset-class allocations.

“In today’s fragmented financial architecture, liquidity in fixed income markets is not merely a risk constraint—it is a strategic asset,” said Michael DePalma, Co-Head of Global Fixed Income at MacKay Shields. “Because daily pricing does not guarantee market-clearing liquidity, we structure our multi-sector portfolios with explicit liquidity tiers that act as operational pressure valves. When market leverage unwinds and dealer balance sheets tighten, immediate collateral availability can provide greater flexibility to navigate periods of market stress and evaluate potential opportunities arising from forced selling across global rates, credit and securitized markets.”

Ultimately, NYLIM’s research finds that a more fragmented liquidity architecture is not necessarily a less resilient one. A wider range of capital providers can diversify the financial system’s capacity to absorb shocks, but that capacity is less uniform and increasingly sits outside traditional central-bank backstops. For investors, that raises the importance of understanding where liquidity is coming from and how reliably it may be available when markets come under pressure.

Read the full 2026 Megatrends report, The Next Era in Global Liquidity: An Architecture, and explore additional insights from NYLIM Global Market Strategy here.

Sourc: New York Life Investment Management