Fede Valverde can surpass Gerrard - Ancelotti
The Italian was asked about the comparison between the Uruguayan and the current Aston Villa manager, who was a similar dynamic midfielder in his playing days, made by former Liverpool and Barcelona striker Luis Suarez.
The striker spoke to Spanish newspaper Marca and said he noticed Valverde's characteristics, including the ability to go box to box and arrive in dangerous positions, reminded him of his former Anfield team-mate.
"I agree, he has a lot of the same talents as Gerrard," Ancelotti told reporters.
"It's very good that they are comparing him with a player that has had this success.
"I think that Federico has everything he needs to reach Gerrard's level and go even further still."
Valverde has played an important role for Real Madrid this season, frequently operating on the right flank as part of a forward line missing French striker Karim Benzema due to injury.
Ancelotti confirmed Benzema is set to start for Madrid on Sunday when they welcome Osasuna to the Santiago Bernabeu, recovering from the thigh problem he sustained against Celtic on September 6.
"We'll see that after this period where he has not played, we'll be speaking about the same Karim as ever, which is that he's spectacular," Ancelotti said.