State Street’s Private Equity Index Continues Strong Performance in 3Q 2017

Feb 1 2018 | 3:47pm ET

State Street’s Global Exchange SM Private Equity Index (GXPEI) closed the third quarter of 2017 with a positive return of 3.85%, according to the firm in a press release.

Buyout funds continue to lead private equity strategies in gains, marking it their seventh consecutive quarterly gain.

The GXPEI is based on directly-sourced limited partnership data. It represents more than $2.7 trillion in private equity investments and more than 2,800 unique private equity partnerships, as of Sept. 30, 2017.

“Momentum is the name of the game in the third quarter of 2017,” Will Kinlaw, senior managing director and global head of State Street Associates, a division of State Street Global Exchange, said in a statement. “Not only were the overall returns close to the previous quarter’s strong returns, but the relative performances across market segments was largely unchanged.”

Third Quarter Highlights Include:

  • Buyout funds posted a 4.11% gain in Q3. While slightly lower than Q2’s 4.73%, they still led the three main strategies for the seventh consecutive quarter. 
  • Venture capital return improved to 3.57% from 1.84% in Q2 and private debt funds inched lower to 2.84% in Q3 from 3.08% in Q2. 
  • European focused private equity funds experienced a 6.07% quarterly gain in the U.S. dollar denominated terms. U.S. focused funds returned 3.20%, while funds focused on the rest of the world gained 4.29%. 
  • Among sectors, industrial funds saw the highest return rising to 5.87%, up from 4.73% in Q2; followed by information technology funds with a return of 3.80%, up from 3.10% in Q2; energy funds’ performance improved to 2.59% this quarter up from 0.26% in Q2. 
  • Average monthly paid-in-capital to commitment (PICC) increased to 0.74% in 2017 up from 0.64% in 2016 while average monthly distribution to commitment (DCC) increased to 1.04% in 2017 up from 0.88% in 2016. 

State Street Corporation is a world leading provider of financial services to institutional investors, including investment servicing, investment management and investment research and trading. As of December 2017, the firm has $33.10 trillion in assets under custody and administration and $2.80 trillion in assets under management.

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