Private Equity Funds: Leverage and Performance Evaluation
Leverage is pervasive in today’s private equity markets. Antonella Puca, CFA, CIPM, CPA, explores how private equity funds apply it and how investors should approach it.
View ArticleTop Five Articles from July: Private Equity, ESG, High Yield Today
Why do professional investors talk about behavioral finance more than they apply its insights? How do single stocks influence factor returns? The leading Enterprising Investor posts from last month...
View ArticlePersistence That Just Ain’t So
Do private equity presentations overstate an ability to persist?
View ArticlePrivate Equity: The Emperor Has No Clothes
Liquid alternatives to private equity can be created simply by buying small, cheap, and levered stocks, Nicolas Rabener writes.
View ArticlePrivate Equity Access: Should We Beware?
Should retail investors have access to private equity investments? Preston McSwain shares his take.
View ArticleTennis Lessons for Alternative Investors
What does the current era of professional tennis have to teach us about the state of venture capital (VC) and private equity (PE)?
View ArticleJust a Little Higher? Antti Ilmanen on the Low-Return Challenge
How can investors adapt to a low-for-long rate environment? Antti Ilmanen proposed several potential strategies.
View ArticlePrivate Equity: Fooling Some of the People All of the Time?
“This time is different” might be the four most dangerous words in investing. “Uncorrelated returns” may just be the two most lucrative.
View ArticleJason DeSena Trennert: Beware Private Equity Valuations
The real valuation problems today are much more evident in private equity markets, says Jason DeSena Trennert.
View ArticleIn Private Markets, Red Is the New Black
Private capital fund managers do not expect their portfolio businesses to report a profit.
View ArticleDecoding Private Equity Performance
What does a solution to the private equity performance puzzle look like?
View ArticlePrivate Equity: The Weight of the COVID-19 Crown
What happens to private equity valuations when public equity markets collapse?
View ArticleWhat Drives Indian Private Equity Returns — Growth or Alpha?
What explains the total weighted average IRR of Indian private equity?
View ArticleModern Private Equity and the End of Creative Destruction
Our economies are under the stewardship of fund managers with one goal in mind: to maximize fee income, even if it means holding on to impaired assets.
View ArticlePrivate Equity vs. Venture Capital: Opposite Investment Mindsets
PE and VC performance-enhancing techniques are not just different, they are precise opposites.
View ArticleTime’s Up for the IRR: Resetting the Clock on Private Equity
The internal rate of return is dead. Long live the IRR.
View ArticleMyths of Private Equity Performance: Part I
"In private markets, no one can figure out your true performance."
View ArticleMyths of Private Equity Performance: Part II
What explains the absence of predictability in private equity performance?
View ArticleMyths of Private Equity Performance: Part III
Private equity is not more resilient than other asset classes. Quite the opposite.
View ArticleTop 10 Posts from 2020: COVID-19, The Silent Depression, Damodaran
What Enterprising Investor articles most resonated with readers in 2020?
View ArticleMyths of Private Equity Performance: Part IV
PE results can neither be benchmarked reliably nor delivered consistently.
View ArticleThe Short, the Index, and the Private Markets
There is no valid benchmark for the unlisted private equity sector. That needs to change.
View ArticlePermanent Capital: The Holy Grail of Private Markets
The goal of private equity is to be impervious to the vagaries of the economic cycle and to outside interference.
View ArticleBook Review: Corporate Governance and Responsible Investment in Private Equity
Simon Witney provides a groundbreaking overview of effective governance and responsible investment in private equity.
View Article“Alpha-Flation”: A Private Market Syndrome
Why does investing in the "average" private market fund seem to go so poorly?
View ArticlePerpetual Debt Is Already Here
The costs and risks associated with debt have shifted from the borrower to the lender.
View ArticleMarket Resiliency, Capital Formation, and Investing for Our Future
The story of the markets over the last 10 years has been one of remarkable change. Yet economies are still struggling.
View ArticleBook Review: The Caesars Palace Coup
Max Frumes and Sujeet Indap provide a fascinating inside account of the distressed debt markets, including the strategies, the colorful personalities, and the complex relationships.
View ArticleModern Variants of Capitalism, Part 2: Financial Capitalism
In financial capitalism, wealth is transaction-based rather than operational.
View ArticleBook Review: Asset Allocation and Private Markets
Even investors who operate exclusively in public markets can benefit from the book’s thoughtful and sometimes unconventional takes.
View ArticleThe S-Curve: Bending the J-Curve in Private Equity
The J-curve narrative in private equity (PE) investments deserves a quiet obsolescence.
View ArticlePrivate Equity: Market Saturation Spawns Runaway Dealmaking
Private equity is settling into a rent-extracting, self-dealing trade.
View ArticleAlternative Investments: Predictable Uncertainty in Private Markets
While analytical judgment is considered universal in science, in finance investment decisions are derived from mental heuristics.
View ArticleDrowning in the Private Equity Pool
What's most surprising about aggregated private market performance calculations? How deeply flawed they are.
View ArticleThe Private Capital Wealth Equation, Part 1: The Controls Variable
Private capital fund managers have developed tools to reduce risk while protecting or even boosting their returns.
View ArticleThe Private Capital Wealth Equation, Part 2: The Economics Variable
The performance of alternative asset managers is encapsulated in the formula: Wealth = Controls + Economics. Here, we outline the economics component of the equation.
View ArticleNot All NAVs Are Created Equal
How can investors price NAV valuations and efficiently transfer their eventual risk?
View ArticleNew Breed of Private Capital Firms Will Face Performance Headwinds
A challenge awaits PE firms that amass funds to expand beyond their core competency.
View ArticleTricks of the Private Equity Trade, Part 1: Value Drivers
PE firms have a repertoire of tools at their disposal to achieve their target returns.
View ArticleTricks of the Private Equity Trade, Part 2: Leverage
The essence of maximizing the internal rate of return (IRR) lies in the total amount of leverage contracted to finance a transaction.
View ArticlePrivate Markets: Guardians at the Gate?
Regulatory reform in the private markets should focus on five areas.
View ArticleMyth-Busting: Alts’ Uncorrelated Returns Diversify Portfolios
Do alternatives offer any diversification benefits?
View ArticleAgency Capitalism in Private Markets: Who Watches the Agents?
With the PE model’s high profitability, the industry’s ultimate development stage will inevitably feature leveraged buyouts of the fund managers themselves,
View ArticleDistress Investing: A Tale of Two Case Studies
With recession forecasted in many economies this year or next, distressed situations will be an important source of deals for prospective investors.
View ArticlePrivate Capital: Lessons from the Conglomerate Era
With their sprawling empires, the largest alternative asset managers have adopted strategies that borrow extensively from the octopus-like corporate conglomerate business model.
View ArticleBook Review: These Are the Plunderers
The PE playbook is always the same: Borrow money to acquire the firm, saddle it with debt, and extract exorbitant management fees.
View ArticleBook Review: Plunder
Brendan Ballou presents a meta-analysis of the worst of private equity investment practices, thus compelling investors to take a deeper look into their illiquid private equity commitments.
View ArticleThe 60/40 Portfolio Needs an Alts Infusion
How can investors supplement the traditional 60/40 stock/bond portfolio with allocations to alternatives?
View ArticleMergers and Acquisitions in 2024: Headwinds to Tailwinds?
With wide spreads, an improved playbook for assessing deal risk, and the potential for more M&A activity to materialize, 2024 could be a strong year for merger arbitrage performance.
View ArticleTimes Change: The Era of the Private Equity Denominator Effect
How can investors address the denominator effect in private equities?
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