Australian private equity and venture capital outperformed the listed market by over 20% in the 12 months to 30 September 2014, according to data released today by the Australian Private Equity and Venture Capital Association Limited (AVCAL) and Cambridge Associates.
The Cambridge Associates LLC Australia Private Equity and Venture Capital Index (the CA Australia Index) posted a gain of 27%, compared to a 6% return for the S&P/ASX 300 Index over the same one-year period.
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The CA Australia Index – which is the leading independent performance benchmark for the private equity and venture capital asset class – showed continuing outperformance across all measured time horizons for private equity and venture capital compared with listed equities, from one-quarter to 15-year returns.
"The past few quarters have delivered very good returns for investors with allocations to private equity and venture capital," said AVCAL Chief Executive Yasser El-Ansary. "This is true of both the early-stage venture capital funds right through to the larger growth private equity and buyout funds."
"We’ve seen a lot of momentum building in the exit environment over the last eighteen months, especially through initial public offerings on the listed market. Companies backed by private equity also tend to perform well post-listing, as our recent study with Rothschild showed. This demonstrates the long-term value that private equity investment can bring to Australian businesses," said Mr El-Ansary.
Eugene Snyman, Managing Director at Cambridge Associates’ office in Sydney, Australia, said: "Institutional investors who have stayed allocated in Australian private equity and venture capital saw strong returns over the last year. Diligent, ongoing investments in the asset classes continue to add value, with many investors achieving net of fees returns of over 600bps above listed markets."
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