Applied analytics and quantitative methods for private equity investing
There now exists sophisticated quantitative methods for private equity GPs and LPs to assess investment opportunities, to value businesses, to benchmark portfolio performance, and to design incentives for executives and managers.
Edited by Oliver Gottschalg of HEC Paris and PERACS Private Equity Track Record Analytics, Private Equity Mathematics, Second Edition, is a must-have publication for all professionals investing in private equity assets and funds. This book is a valuable and practical resource with topics ranging from performance measurement and benchmarking, cash flow patterns and risks of private equity investing, to the economic and legal aspects of operating a private equity firm or investment programme.
In addition to updated and expanded content, this guide features recent advancements in performance measurement, benchmarking and risk assessment.
This guide will help you:
- Understand the fundamentals of private equity investing and value creation drivers
- Rectify issues with inappropriate use of common performance measures
- Develop effective methods and benchmarks to assess investment performance
- Optimise the measurement, management and integration of risk in the portfolio
- Better understand how to measure volatility in private equity investing; plus much more
Who should read this guide?
- Fund managers
- Fund of fund managers
- Institutional investors
- Lawyers
- Consultants
- Bankers
- Academics
- Analysts
Satyan Malhotra, Caspian Private Equity
Ivan Herger, Capital Dynamics
Fernando Vazquez, PERACS Private Equity Track
Record Analytics
Robert M. Ryan, PERACS Private Equity Track Record Analytics
Bernd Kreuter, Palladio Partners
Elias Korosis, Hermes GPE and Roy Kuo, Church Commissioners
Brian Gallagher, Twin Bridge Capital Partners
Alexander Peter Groh, EMLYON Business School
Michael J. Album, Proskauer Rose LLP
Trevor J. Chaplick, Proskauer Rose LLP
Joshua M. Miller, Proskauer Rose LLP
Jenny Wheater and Pierfrancesco Carbone, Duane Morris LLP
John Barber, Bridgepoint
Leon Hadass, Pantheon and Arantxa Prado
Michael J. Ryan, Hamilton Lane
Griffith Norville, Hamilton Lane
Section 1: Fundamentals
1. Private equity as part of your portfolio
Satyan Malhotra, Caspian Private Equity
2. Measuring private equity performance: a closer look
Ludovic Phalippou, University of Oxford
3. The private equity J-curve: Cash flow considerations from primary and secondary points of view
Ivan Herger, Capital Dynamics
4. Evaluating the private equity risk profile for GPs and LPs
By Fernando Vazquez, PERACS Private Equity Track Record Analytics
5. A Monte Carlo approach for risk management in private equity portfolios
Bernd Kreuter, Palladio Partners and Oliver Gottschalg, HEC Paris and PERACS Private Equity Track Record Analytics
6. Adventures in risk budgeting: moving forward on private equity portfolio risk
Elias Korosis, Hermes GPE and Roy Kuo, Church Commissioners
Section 2: Investing
7. Performance drivers in private equity investments
Oliver Gottschalg, HEC Paris and PERACS Private Equity Track Record Analytics
8. Valuing private equity buyouts
Brian Gallagher, Twin Bridge Capital Partners
9. Private equity performance benchmarking
Robert M. Ryan, PERACS Private Equity Track Record Analytics
10. Benchmarking leveraged buyouts against comparable public market investments
Alexander Peter Groh, EMLYON Business School
11. A pragmatic approach to estimating the relative performance of private equity investments
Oliver Gottschalg, HEC Paris and PERACS Private Equity Track Record Analytics
12. Measuring and interpreting performance persistence in private equity
Oliver Gottschalg, HEC Paris and PERACS Private Equity Track Record Analytics
Section 3: Fund and Portfolio Management
13. Compensation issues for management in a US MBO
Michael J. Album, Trevor J. Chaplick, and Joshua M. Miller, Proskauer Rose LLP
14. Compensation issues for management in a European MBO
Jenny Wheater and Pierfrancesco Carbone, Duane Morris LLP
15. Management fee, carried interest and other economic terms of private equity funds
John Barber, Bridgepoint
16. Fund of funds portfolio perspective
By Leon Hadass, Pantheon and Arantxa Prado
17. Insights in assessing the performance of private equity service providers
Michael J. Ryan, Hamilton Lane
18 Measuring volatility in private equity
Griffith Norville, Hamilton Lane
Glossary
