INSIGHT REPORT CALENDAR

NEWSLETTER

Like this article?

Sign up to our free newsletter

Australian PE returned 7.85% in 2011

The Cambridge Associates LLC Australia Private Equity and Venture Capital Index (CA Australia Index) rose by 7.85% in 2011, significantly outperforming the S&P/ASX 300 Accumulation Index which fell by 10.98% over the same period. This translated to an outperformance of 18.83% — net of fees — for the 2011 calendar year.

The CA Australia Index outperformed the S&P/ASX 300 Accumulation Index over nearly all time horizons for up to 10 years, according to the latest quarterly report released by the Australian Private Equity and Venture Capital Association Ltd (AVCAL) today.

As of 31 December 2011, the CA Australia Index had annualised returns of 7.85%, 7.11%, 3.29% and 7.52% over one, three, five and ten years respectively. This relatively stable pattern of returns contrasted sharply with that of the S&P/ASX 300 Accumulation Index, which fluctuated between annualised returns of -10.98%, 7.67%, -2.39% and 6.14% over the same horizons.

Pooled returns from most investment vintage years have performed very well to date. And despite the lacklustre performance of public equities in the last two years, companies receiving their initial injections of private equity and venture capital investment in 2010 and 2011 have performed well by comparison, recording pooled returns of 14.26% and -3.43% respectively as of the end of 2011.

Australian Private Equity & Venture Capital Association (AVCAL) CEO Dr Katherine Woodthorpe (pictured), says: "The collective performance of our members has been simply outstanding, even despite the effects of the global financial crisis over the preceding years. It simply further demonstrates the value of investing in private equity and venture capital. This asset class generates the kind of long-term returns that investors – whether they are superannuation funds, sovereign wealth funds or other wealth management funds – are crying out for today."

Eugene Snyman, Managing Director at Cambridge Associates’ office in Sydney, Australia, says: "This consistently strong performance bodes well for fundraising and investment activity through the remainder of the year and into 2013."

This is the seventh quarterly report from the Index, which is a result of a strategic partnership between AVCAL and Cambridge Associates, global provider of independent research and investment consulting services.

 

Like this article? Sign up to our free newsletter

FEATURED

Tech Stocks

MOST RECENT

FURTHER READING