What are your Investment Rules?

[kiora]

Private Equity:Some investors chase Private Equity to improve returns?


"Generate commits NZD55 million to private equity"
https://www.goodreturns.co.nz/sponsored.html

"https://simplicity.kiwi/private-equity"
"The Simplicity Private Equity Fund invests in Venture Capital and Private Equity"

"Bank of England looks to shine a light on private equity leverage"
https://www.reuters.com/world/uk/ban...ge-2024-04-22/
"Regulators need to shine a light on the $8 trillion global private equity sector, as opaque leverage makes it hard to get a picture of the risks it poses to financial stability, jobs and growth, a Bank of England official said on Monday."
""Recent developments in that market have the potential to disrupt the supply of funding to real economy companies in a stress. And to cause systemic institutions – such as banks – to experience significant and correlated losses on their exposures linked to private equity," Benjamin added."
https://www.telegraph.co.uk/business/2024/03/27/private-equity-correction-threatens-financial-crisis/"

"“Private capital is a key partner for driving growth in every nation and region of the UK,” said Michael Moore, CEO at the BVCA, “but investment by the industry could be even greater with the right policy environment in place."
"Private equity and venture capital investment into the UK has crashed since 2021"
https://www.cityam.com/private-equit...ed-since-2021/

"What are the cons of private equity investing?

Private equity investments are illiquid: Investor's funds are locked for a certain period. As such, investors in private equity must have a long-term investment horizon and be willing to hold their investments for a few years, if not more. This requirement makes private equity investments more suitable for long-term investors.
Higher risk: Private equity investments often involve significant risks, including the potential loss of your entire investment, which must be part of the individual investors’ consideration process. While thorough due diligence can vet the project's viability and overall microeconomic risks, external factors can impact the success of any investment, including the private market. Macroeconomic risks are those outside the control of a company and may include political instability, legislative changes, natural disasters, economic recession, or even health crises, and more.
Limited information: Private companies are not required to disclose financial information in the same way as publicly traded companies. The success of the investment is highly dependent on the performance of the underlying company, which may face a range of operational, financial, or market risks. Private equity funds may also invest in relatively early-stage companies, which can be highly speculative and may not have a proven track record of profitability."
https://graniteharbor.com/learning-c...f%20not%20more.
https://theimpactinvestor.com/pros-a...quity-to-know/

"The £5 trillion ‘pyramid scheme’ threatening to wreck your retirement
The ‘Wild West’ of private equity valuations risks triggering a pension funds catastrophe"
https://www.telegraph.co.uk/business...ns-retirement/

[kiora]

From the UK

"Private Equity is eyeing up your pension fund, is there reason to be nervous?

https://championsukplc.com/insights/...-to-be-nervous

"target long term is to make sure around 5% of its portfolio invested in private equity."
" US public pension funds generated more than 12% annualised return from their private equity investments, net of fees, between 2010 and 2020."
"Hypothetically, there are advantages for everyone if UK pension schemes begin to invest in private markets and private equity. Pension schemes could potentially benefit from better returns, and the value creation generated could provide the UK economy and entrepreneurial industries with a lift. The only perceived downside is the slightly higher risk involved in a private equity investment."
https://championsukplc.com/insights/...-to-be-nervous