Growth equity is the next phase, when the risk shifts from whether a product will work to whether it can gain market adoption. For example, a buyout fund’s outcome has a lot to do with the nature of the debt markets from the beginning of the fund through its investment period, on whether there’s a recession, and on whether the public markets have been receptive to an exit during the second half of the fund’s life. In the private markets, we have witnessed surging demand in companies that focus on remote work applications (see 5/14 COTW), data centers, esports, biotechnology and consumer packaged goods, helping to offset significant weakness in multisite businesses (doctors’ offices, gyms and restaurants), hospitality, airlines and energy. In the past, individual investors have allocated to private equity through registered and unregistered private equity funds-of-funds. This underscores the basic need to construct private equity allocations that are diversified by manager, strategy, and vintage. This week’s chart shows median global private equity returns by vintage year, revealing that the best vintages appear correlated with weaker economic conditions. Your article was successfully shared with the contacts you provided. Financial advisors can add substantial value by finding a private equity platform that is committed to bringing quality new funds over the course of each year with minimum capital commitments, sized to enable vintage year-over-year diversification. Investors cannot time the market in private equity any better than in traditional investments. As shown in Figure 2, the spread between private equity beta and the asset class’ top-performing funds can exceed 1,000 basis points. Investment Analysis and Portfolio Management. Knightsbridge sources its secondary investments through its industry network, including GPs, LPs, intermediaries, and other secondary funds. Discover four ways to ignite a spark -- and to keep it burning -- with your customers. H���ok�P��~����Q���B)$��nͶ&�2J_�jC`��m���fP As most would acknowledge, attempting to forecast market conditions over a prolonged period is a futile exercise. Also, State Street adds a new fixed income ETF. In private equity, it is the difference between meeting one’s return goals and falling short. High-Yield bonds are subject to greater fluctuations in value and risk of loss of income and principal. The process is arduous and if built from the ground up, it can take years for portfolios to reach their desired target allocations. Much has been made of the low returns that broadly diversified funds‐of‐funds products have served up, not to mention the lack of flexibility as investors don't necessarily want an off-the-shelf product. %%EOF A single fund will generate a significant number of capital calls and distributions over its life. The value-added potential of private equity manager selection is substantial. The portion of capital that has not been called, should be held in relatively liquid securities in order to satisfy future capital calls. | Exclusive discounts on ALM and ThinkAdvisor events. The scale and experience of institutional investors gives them significant advantages compared with high net worth investors in terms of carefully constructing intelligent portfolios of best-in-class private equity funds. O+�c� ����[&�P.�EA�J�(O���ŔV�6-l�mF8�۬p)�9�m^�� Those investors who are able to put capital to work consistently across cycles will likely yield the best results. Provide Vintage Year Diversification. Statements that reflect projections or expectations of future financial or economic performance of the markets may be considered forward-looking statements. Amid an ever-evolving landscape, access platforms have evolved away from the fund-of-funds model to enable high-net-worth individuals to invest in private equity with substantially reduced minimum commitments on a one-off basis. :� �v��Zs���`��.� �>��&��� �9(�?��O��=h���-� For GPs that have managed a top-quartile fund, there’s a better than 6-in-10 probability that their successor fund will also be an above-average performer³. Further, successful private equity investors tend to commit capital not just to top-quartile managers but across vintage years. However, private equity funds-of-funds are ‘one size fits all’ and tend to be overly diversified in order to offer enhanced liquidity for the pool which often results in diluted returns. ꩟�^9l�R�Pгp���ޅ���q{�\-X���E ��p�)Mw��NW�t���o��1���f�^U�����L5���"�)~���������J�(;Pn��u\��~+���/�7�)��������]9�Vbըm�p�N�F�A���� �|����b�� �*���üV�>7��&d����mݴ��{(hH�\���|(>���rVL��O_4��`�٤+����KD#��1:j��9�Ӫ�Dp�8�r����n�U1*��U��M�:�2�V�����}1n�����zq��>�4�F\r縞U�^L��},o+�������Q9�?�kn���Y)�_;�O��k� }�f�`M1��?`a� $���]�΋? Prospective investors should also note that investments in the products described involve long lock-ups and do not provide investors with liquidity. The vintage year of a fund, and the phase of the business cycle in which the vintage year occurred, is highly determinative of the performance outcome realized by the fund. In fact, right now may be your moment to take that first step and stay focused on your career goals. University. iCapital announced an agreement to take ownership of factorE, a portfolio analytics tool, from @AlphacoreWealth to bolster its tech toolkit for advisors. �9���}`R,^"%Z@�s�� �� IFA �JD��g�"�ځ$s�^&0�C8�����{X �(�B�g�nv � '�� Knightsbridge has also invested selectively in non-early stage venture partnerships for more than three decades. [1] Based on research by Steve Kaplan and Antoinette Schoar, Private Equity Performance: Returns, Persistence, and Capital Flows. Nor is the company liable for any direct or indirect technical or system issues or any consequences arising out of your access to or your use of third-party technologies, web sites, information and programs made available through the web site. However, it is critical to understand that not all private equity platforms and structures are created equal, and that structures such as funds-of-funds and access platforms are riddled with shortcomings, all of which Crystal Capital Partners resolves. Course 28 Private Asset Class Roles and Benchmarks Item 6a, Attachment 1, Page 28 of 30 INVESTMENT & INVESTOR RELATIONS125 CambridgePark Drive, Suite 400BCambridge, MA 02140 USA, FINANCE & OPERATIONS122 SW Frank Phillips BoulevardBartlesville, OK 74003 USA.

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