According to recent trends, what has changed in the capital overhang multiple from the end of 2020 to the present?

The correct choice reflects a decrease in the capital overhang multiple from 3.1x to 2.6x. This indicates a shift in the market dynamics regarding the availability of capital that has not yet been deployed into investments. A decrease in the capital overhang multiple suggests that either there is more capital being deployed or that the amount of capital available for investment has declined relative to the existing opportunities in the market.

Understanding this trend is crucial because a lower multiple typically signifies that investors are either more cautiously deploying their capital or that there are fewer attractive investment opportunities available. This can affect market liquidity and the competitive landscape for private capital investments, hinting at a more cautious investment environment and potentially fewer transactions being completed.

In contrast, an increase or consistency in the multiples would signify a stronger capital availability scenario or sustained interest in deploying capital, which is not the case according to the indicated change. Similarly, fluctuations would not reflect the steady downward trend indicated by the correct answer.