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The medium- to long-term focus of private equity makes it the perfect asset class in a world faced with increasing volatility
After weeks of historic levels of value erosion in global capital markets, many asset managers are trying to mitigate emerging risks while finding new opportunities. Economic experts expect more capital market shocks for the rest of the year. Private equity, as one of the main alternative investment classes, finds itself in an interesting position in the face of such market volatility.
Private equity (PE) funds commit to a higher return profile than the open markets in the medium to long term. They are also characterised by 10-year terms, so fund managers sit tight in the face of market volatility and do not rush to make short-term decisions. These are redeeming qualities that are likely to give asset managers a better level of comfort in times of uncertainty...
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