Private Equity Fund of Funds vs. Funds : A Performance Comparison
Journal
Journal of Private Equity
ISSN
1096-5572
Type
journal article
Date Issued
2011-04-19
Author(s)
Abstract
Based on a comprehensive sample of 1,641 funds, this article investigates the performance of private equity funds of funds versus direct fund investments. On a risk-adjusted basis, funds of funds outperform the aggregated direct funds. When separated into categories such as buyout, venture, and fund of funds, buyout funds exhibit the most attractive risk-return profile. Analyzing how fund performance depends on macroeconomic variables, direct funds generate pro-cyclical returns: Returns increase with high public market performance and economic growth as well as declining corporate bond yields. For funds of funds, we cannot observe such a pattern.
Language
English
HSG Classification
contribution to scientific community
Refereed
Yes
Publisher
Institutional Investor Journals
Publisher place
New York
Volume
14
Number
2
Start page
43
End page
58
Pages
16
Subject(s)
Eprints ID
100370