Study: PE Returns Up but Lag Public Markets

A study finds that buyout returns have rebounded since the financial crisis but still lag the public markets.

Private equity IRRs (can you say that three times fast?) for the one year period ended Dec. 31 stood at 13.8%, up from the -9.2% posted in third quarter 2009, Preqin said. The buyout returns are also up signficantly from the -27.6% reported in fourth quarter 2008. Preqin, a provider of data and analysis, notes that private equity returns and portfolio valuations were affected heavily by the financial crisis at the end of 2008. So, this major bump isn’t surprising, Preqin says.

However, the public markets have done a better job of rebounding. The one year returns, as of fourth quarter, for the Standard & Poor’s 500 was 26.5%, while the MSCI Europe was up 35.8% and the MSCI Emerging Markets were at 78.5%. Read the Study Here.