State Street Launches Liquid Private Equity Investable Index
September 23 2015 - 2:41PM
Business Wire
New Investable Index Built on State Street’s GX Private Equity
Index of More Than 2,400 Funds and more than $2 Trillion in Capital
Commitments
State Street Corporation (NYSE: STT) today announced the launch
of the State Street Liquid Private Equity Investable Index, a new
solution that provides public access to private equity sector
exposures. The model is intended to be used as a liquid proxy for
direct private equity investment and is the first in a series of
investable indices.
The index was developed from research generated by State
Street’s academic partnership, State Street Associates, which
suggests that private equity managers collectively outperform the
public equity markets in part by anticipating the relative
performance of economic sectors. Based on this evidence, the model
identifies private equity sector exposures utilizing the
proprietary State Street GX Private Equity Index (SSPEI), which
consists of more than 2,400 private equity funds representing more
than $2.2 trillion in capital commitments. The SSPEI sources data
from actual Limited Partner (LP) records, with historical global
daily cash flow data back to 1980.
“While the Index can’t replicate the deal-specific alpha that a
top private equity manger can deliver, it can provide a liquid,
alternative to investors who can’t immediately deploy capital into
true private equity investments,” said Will Kinlaw, senior managing
director and head of State Street Associates. “This index
demonstrates our ability to develop investment strategies that
integrate the worlds of academic theory and financial markets
practice – and to derive actionable information from data.”
For asset owners, the index provides a liquid means to increase
or decrease effective private equity exposure and also provides
interim exposure that can potentially reduce cash drag on
performance while preserving liquidity to meet capital calls. For
asset managers, the index provides access to a liquid return stream
similar to private equity and satisfies private equity asset
allocation requirements without the traditional impediments of
illiquidity, lack of investment transparency, layered fee
structures and large minimum investments.
The index is currently available for licensing in the United
States and Australia, with subsequent launches to follow in the
United Kingdom, Singapore, Switzerland and Canada.
To learn more about the GX Private Equity Index, click here.
About State Street Corporation
State Street Corporation (NYSE: STT) is one of the world's
leading provider of financial services to institutional investors
including investment servicing, investment management and
investment research and trading. With $28.7 trillion in assets
under custody and administration and $2.4 trillion* in assets under
management as of June 30, 2015, 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 web site at www.statestreet.com.
* This AUM includes assets (approximately $26.7 billion as of
June 30, 2015), for which State Street Global Markets, LLC, an
affiliate of SSgA, serves as the distribution agent.
CORP-1596
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State Street CorporationJulie Kane, +1
617-664-3001JEKane@statestreet.com
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