PrEQIn Private Equity Quarterly Index Update: Q3 2015 Performance – June 2016

by Darren Fernandes

  • 30 Jun 2016
  • PE

The PrEQIn Private Equity Quarterly Index can be used as a method for measuring private equity performance over a specific period of time. Using performance data for 8,300 individual private equity partnerships from Preqin’s Private Equity Online, the index captures the average return earned by investors in their private equity portfolios, based on the actual amount of money invested. The chart below displays the performance of the index against the S&P 500 Total Return Index to provide a public market comparison.

Each private equity strategy over the past three years has seen an overall increase in the PrEQIn Index for almost every quarter, with this trend continuing into Q3 2015. The largest increase was in the PrEQIn Buyout Index, which gained over six index points to stand at 425.5 as of 30 September 2015; the strategy remains the best performing since 2000. Notably, only the S&P 500 declined 6.5% from 207.7 to 194.3. The PrEQIn Venture Capital Index, which has consistently underperformed the industry as a whole, posted the lowest index gains (0.6) in Q3 2015 of all the alternative strategies; venture capital remains the worst performing strategy since 2000, with the index having only broken over 100 in the first quarter of 2015.

With the continued trend of positive returns across all private equity strategies in recent years, as well as outperforming the public market in Q3 2015, it is evident that private equity investments continue to offer investors the potential for stable returns.

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