Boston QWAFAFEW – December 15 2020, 7:00 PM ET
Constructing Private Equity Benchmarks
With the evolution of private assets from an exotic experiment to sought-after driver of yield and return in institutional portfolios, serious challenges emerged to appropriately review and forecast benchmark relative performance. The main difficulty relates to the fact that unlike publicly traded investment the values and returns reported by private asset investment managers are very subjective, making it difficult to perform the usual benchmark construction process where one can rely on a particular investment or a combination of investments to be an appropriate and unbiased gauge for the relative performance of another investment. We will make an overview of the attempts made by the industry to operate in the face of this challenge. Consequently, we will describe four approaches that, with some modifications, overcome the shortfalls of pre-existing methodology, and have distinct applications in the institutional investment process. Those methods can be categorized as the private-to-private returns, private-to-public-plus-margin returns, public-discounted-paid-in multiples, and liability-relative benchmarking.
Emilian Belev has led the research and development of Northfield’s Enterprise Risk Analytics at Northfield for about two decades. He is responsible for an integrated framework of multi-asset class analysis. The range of modelled assets under his responsibility includes equity, fixed income, currency, interest rate, and credit derivatives, structured products, directly owned real estate, private equity, and infrastructure. He has introduced innovative methodologies in the areas of convertible bond analytics, pricing path dependency, credit risk analysis, and optimal investing in infrastructure, commercial real estate, and private equity. Emilian has presented on some of these topics at industry events internationally and published research in peer reviewed journals and book chapters.
Dec 15, 2020 07:00 PM in Eastern Time (US and Canada)
Time: 7:00 PM sharpe
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