The Cambridge Associates Australia Private Equity and Venture Capital Index (C|A Australia Index) showed steady gains in 2012, increasing by 5.78 per cent, according to the latest quarterly report released by The Australian Private Equity and Venture Capital Association (AVCAL).
Over the same period, the S&P/ASX 300 Index surged by 19.74 per cent, due in part to multiple domestic interest rate cuts and strong global stock market performance.
Notwithstanding the sharp rise in the listed index over the preceding 12 months, the C|A Australia Index continued to beat listed equities over three and five-year horizons, with returns of 6.88 per cent and 2.83 per cent, compared to returns of 2.8 per cent and -1.81 per cent for the S&P/ASX 300, respectively.
Over a 15-year time period, the C|A Australia Index delivered a 8.73 per cent return on an AUD basis and a 14.26 per cent return on a USD basis.
The C|A Australia Index returned 1.56 per cent for the quarter ending 31 December 2012. This continues the trend of positive performance by the index, where returns for 10 of the last 12 quarters since January 2010 have been positive.
Katherine Woodthorpe, chief executive of AVCAL, says: "The availability of 15-year data for Australian private equity and venture capital returns provides us with a better understanding of how these industries truly perform. The index has again outpaced listed market returns in the long-term, even despite the surge in public equities in the past year. This highlights the consistent returns, underpinned by long-term growth, that differentiate these investments from other asset classes."
"Australian private equity and venture capital have fared well in 2012, despite mid-year challenges," says Eugene Snyman, managing director at Cambridge Associates’ office in Sydney, Australia. "2012’s positive ending caps off another year of strong performance overall. Looking forward, it will be interesting to see whether public markets will bolster private investment performance in 2013."
