Hi Julie,
I agree with the basic statement about PE valuations and that they are no source of a liquidity premium for manager's alpha. They will not be in the future, however, have not been in the past either, at least since the mid-1990s. As Nicolas Rabener showed recently, PE could have been replicated easily by small, cheap, and levered public stocks with daily liquidity:
https://blogs.stage.cfainstitute.org/investor/2020/01/20/private-equity…

However, this no alpha but just leveraged traditional beta at higher risk at most.

"So where are the alpha opportunities for active mangers?

"As long-term interest rates rise and the yield curve steepens, Trennert believes security selection, sector allocation. and sector rotation are areas to explore."

Isn't this the old school active manager's approach of Stock Picking and Market Timing, which has been proven wrong for quite long time already? I believe in Nicolas Rabener's reliable and cost-effective approach for manager's alpha of combining traditional beta through unbiased broad public stock indices ETFs with alternative beta through uncorrelated long–short multi-factor liquid alternatives, based on managed futures or CTA macro trading strategies in all available markets, i.e., stocks, bonds, commodities, currencies..., both with passive allocations, fixed for the long-term:

https://blogs.stage.cfainstitute.org/investor/2019/09/23/smart-beta-vs-…

If real outperformance is the goal for long-term investments, you have to diversify with other asset classes and with going short. Staying only long within only one market and just shifting allocations from one end to the other repeatedly on your opinion is an unforgiveable waste of time and money for decades already since Bogle's eye opening story of "Lake Wobegon".

Thus, alpha opportunities for active mangers are rather alternative factor picking and their long-term passive allocation. Maybe too simple and not active enough for some active managers. However, all else and not only PE is fooling clients and themselves as well. Can you please comment on my recommendation for active Managers.