Listed Private Equity
- Private equity involves investments of equity capital in private businesses. It provides long-term committed share capital to help unquoted companies grow and succeed.
- Listed private equity (LPE) companies are private equity companies listed on a stock exchange. LPE companies follow the same business model and exhibit the same risk and return potential as their unlisted counterparts.
An LPE company provides shareholders an immediate exposure to a diversified private equity portfolio and exhibits the following characteristics:
Liquidity | Liquid exposure to the private equity asset class; no issue with lock-up; no issue with fixed investment horizon | |
Access | No minimum investment requirements in contrast to traditional private equity (limited partnerships); direct and immediate exposure to a diversified private equity portfolio; no issue with j-curve effect | |
Transparency | Transparent private equity investment portfolio; listing involves high standards of disclosure | |
Diversification | High degree of diversification across regions, private equity investment styles (buyout, growth and venture) and financing styles (equity and mezzanine) | |
Cost | No transaction cost except for bid-ask spread; on average lower management fees than for limited partnerships | |
Performance | Long-term outperformance of all major asset classes | |
Discounts | Investor can often buy at a discount to Net Asset Value (NAV) |
For detailed information please refer to the LPX site. |
