outperformance

Where to Find Outperformance

by

December 9, 2011

The performance of indexes of VC and PE funds are the topic of a commentary published by Cambridge Associates LLC  this week. It caught our eye because the information was a bit counter-intuitive, specifically that developed regions outside the US, including Europe, earned “solid returns” over the past two quarters (it should be noted that non-US returns were aided by a weak U.S. dollar ).

 

Furthermore, both asset classes generated better returns than their public market counterparts. The Indexes in question include PE and VC funds that focus on Australia, Canada, Israel, Japan, New Zealand, and Western Europe. The other index it tracks includes private equity and venture capital funds that invest primarily in Africa, emerging Asia, emerging Europe, Latin America, and the Middle East ex-Israel.

Key Points

– The 2004 vintage year funds were the best performing in both Indices

– The largest vintage year in the developed markets index, 2006, generated an 8% return for the quarter.

– In the emerging markets index, 2007 was the largest vintage; it rose 4.0%.

– Media companies were the chief driver of the 2004 vintage’s performance in the developed markets index, while IT companies were the main contributor to the same vintage’s return in the emerging markets index.

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