Gains in the State Street Global Exchange Private Equity Index Slow for First Time in Two Years
July 31 2018 - 1:22PM
Business Wire
The State Street Global Exchange® Private Equity Index (GXPEI)
ended the first quarter of 2018 with a slight increase of 2.44
percent. The Buyout funds category ended its streak of eight
quarters of outperformance with a 2.09 percent gain, lagging behind
the 3.78 percent return from Venture Capital funds and 2.46 percent
from Private Debt funds.
The PEI is based on directly-sourced limited partnership data
and represents more than $2.8 trillion in private equity
investments, with more than 2,800 unique private equity
partnerships, as of March 31.
“In the first quarter of 2018, volatility spiked across all
asset classes amid an environment of continued geopolitical
uncertainties, escalating risks of trade wars and rising interest
rates,” said Will Kinlaw, senior managing director and global head
of State Street Associates®, a division of State Street Global
Exchange. “Managers’ quarterly contribution rate dropped to a two
year low and exit activities declined as well, indicating a
tendency toward caution.”
First Quarter Highlights Include:
- Buyout funds ended their eight-quarter
streak of realizing the highest returns among the three main
private equity strategies (Buyout, Venture Capital and Private
Debt).
- All strategies saw quarterly decreases
in the level of returns.
- Venture Capital led with a 3.78%
return, down from 4.21% in Q4.
- Private Debt funds with 2.46%, down
from 3.15% in Q4.
- Buyout saw the largest drop, falling to
2.09% from 5.23% in Q4.
- Q1 2018 saw continued depreciation of
the USD against the Euro of 2.42%.
- European-focused private equity funds
experienced a 2.88% quarterly gain in USD-denominated terms (0.41%
in EUR-denominated IRR); US-focused funds returned 2.44%; and funds
focused on the rest of the world gained 1.92%.
- Among sectors, Information Technology
funds led with a 5.20% quarterly return, down slightly from 5.91%
in Q4. They were followed by Financial funds – the only sector to
see an increase in returns from the previous quarter – rising to
4.93% from 2.66% in Q4. Industrials, the leader for the previous
two quarters, saw returns drop to 1.56% from 6.68% in Q4.
For additional insights, or to learn more about the GX Private
Equity Index please visit http://www.ssgx.com/peindex.
Index returns reflect capital gains and losses, income, and the
reinvestment of dividends.
It is not possible to invest directly in an index. Index
performance does not reflect charges and expenses associated with
the fund or brokerage commissions associated with buying and
selling a fund.
Index performance is not meant to represent that of any
particular fund.
About State Street Corporation
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including investment servicing, investment management and
investment research and trading. With $33.90 trillion in assets
under custody and administration and $2.70 trillion* in assets
under management as of June 30, 2018, 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 include the assets of the SPDR® Gold
ETF and the SPDR® Long Dollar Gold Trust ETF (approximately $33
billion as of June 30, 2018), for which State Street Global
Advisors Funds Distributors, LLC (SSGA FD) serves as marketing
agent; SSGA FD and State Street Global Advisors are affiliated.
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