does the volatility in the public markets make PE more attractive to investors?
See above. markets moving 2% every day based on CPI and fed comments, and small caps are crazy volatile with +20%/-20% moves on earnings and macro. wouldn't this create demand for LPs to go to PE, infrastructure, private credit, where there is more stability in earnings/valuations?
“Stability in PE valuations”.
Well, if you just set up continuity funds and buy your own shitty PortCos at good prices, of course it looks stable.
Look back a little and see how many go under or have had shitty returns over the long term. Did a WM stint through grad school and read through hundreds of funds. The only true stability is diversification. No asset class is stable, you can make even a struggling public company look stable for a couple of years with earnings management, doesn’t mean it is.
And liquidity issues. You had to wait a quarter to a year to get your money out. Even firms like Bx stop redemptions and you’re left waiting for months to see your money. And all that time, your true return goes from “20% during investment period” to 10% actual if you include all the wait from committed capital to cash back in hand.
“Stability”
Fugayzi, fugazi. It's a whazy. It's a woozie. It's fairy dust. It doesn't exist. It's never landed. It is no matter. It's not on the elemental chart. It's not fucking real.
Would actually argue the opposite. The level of volatility created even more opportunities for investors to generate alpha
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