Secondaries Modelling?

Hey guys I'm interviewing with some secondaries shops, and I'm not too sure what modelling looks like for these funds. If anyone can explain a bit or send an example, that would be much appreciated. 

Just wanted to get a sense of what to speak to along with prepping for a case interview

4 Comments
 

Generally,

  • a set of assets that you need to forecast expected return and timing of exit. Focus on those assets that represent most of the portfolio value
  • contribution commitments you are stepping into. You need to make an assumption on the new investment returns as well.
  • discount to NAV that is your buy in price

The cash flows from all of the above will give you an IRR. You can reduce the discount to NAV until you reach your target return.

 

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