Following Record 2015 Activity, State Street’s GX Private Equity Idx Continues to Show Noticeable Pullback in Venture Capit...
February 21 2017 - 10:32AM
Business Wire
Despite Slowdown in Activity, Private Equity Returns Continue to
Rise
State Street Corporation (NYSE:STT) today announced the results
of its GX Private Equity Index (PEI), a benchmark for comparative
analysis of private equity performance, which includes a
comprehensive data set, in some cases dating back to 1980. In the
third quarter of 2016, the index saw an overall return of 3.8
percent, with Buyout, Private Debt and Venture Capital each posting
positive returns.
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“Following record years of exit activity in 2014 and 2015,
private equity firms are cautiously putting money to work,” said
Will Kinlaw, senior managing director and global head of State
Street Associates, a division of State Street Global Exchange.
“Despite the second half of 2016 representing some of the lowest
levels of private equity deal activity, we continue to be
encouraged by positive and meaningful gains in returns in all three
private equity categories.”
The PEI is based on directly sourced limited partnership data
and represents more than $2.5 trillion in private equity
investments, with more than 2,600 unique private equity
partnerships, as of September 30, 2016.
Third Quarter Highlights Include:
- Despite the slowdown in activity,
Venture Capital recovered from its previous two quarters of
lackluster returns, posting a quarterly gain of 3.72% in Q3 (up
from 0.28% in Q2). Buyout and Private Equity funds gained 3.86% (up
from 3.41% in Q2) and 3.59% (up from 2.61% in Q2) in Q3,
respectively.
- Among all three main strategies, Buyout
recorded the highest one-year return of 10.38% as of Q3 2016, while
Venture Capital and Private Debt recorded returns of 4.72% and
6.13%,respectively, for the same period.
- While Q3 2016 was another quiet quarter
for the global IPO markets, towards the end of 2016, we observed a
bounce-back in private equity deal activities with both monthly
capital drawdown and distribution ratio picking up
significantly.
- European-focused private equity funds
recorded a strong quarter, 4.08% in USD-denominated returns, up
from 0.67% in the previous quarter. One-year returns also
increased, at 10.82% at the end of September 2016, up from 7.27% in
the previous quarter.
“Volatility in the market as a result of 2016 geopolitical
events is causing investors to hold off on making bold investment
decisions,” said Anthony Catino, managing director, Alternative
Investment Solutions for State Street. “Once instability subsides,
we anticipate an increase in investor activity.”
For additional insights, or to learn more about the GX Private
Equity Index please visit http://www.ssgx.com/peindex.
About State Street CorporationState Street Corporation
(NYSE: STT) is one of the world's leading providers of financial
services to institutional investors, including investment
servicing, investment management and investment research and
trading. With $29 trillion in assets under custody and
administration and $2 trillion* in assets under management as of
December 31, 2016, State Street operates in more than 100
geographic markets worldwide, including the US, Canada, Europe, the
Middle East and Asia. For more information, visit State Street’s
website at www.statestreet.com.
*Assets under management for State Street Global Advisors (SSGA)
were $2.47 trillion as of December 31, 2016. Assets under
management reflects approximately $30.62 billion (as of December
31, 2016) with respect to which State Street Global Markets, LLC
(SSGM) serves as marketing agent; SSGM and SSGA are
affiliated.Important Risk Information – Marketing
Communication
Investing involves risk including the risk of loss of
principal.
Past performance is no guarantee of future results.
Performance of an index is not illustrative of any particular
investment. It is not possible to invest directly in an index.
This press release is provided for informational purposes only
and should not be considered investment advice. Any such views are
subject to change at any time based upon market or other conditions
and State Street disclaims any responsibility to update such views.
Neither State Street nor its affiliates can be held responsible for
any direct or incidental loss incurred by applying any of the
information offered. Please consult your tax or financial advisor
for additional information concerning your specific situation.
State Street Corporation One Lincoln Street, Boston, MA
02111-2900.
© 2017 State Street Corporation - All Rights
ReservedCORP-2661
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version on businesswire.com: http://www.businesswire.com/news/home/20170221006112/en/
State Street CorporationJulie Kane,
+1-617-664-3001JEKane@statestreet.com@StateStreet
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