Private Equity (PE) Performance in The United States

Authors

  • Srinidhi Kanuri The University of Southern Mississippi
  • Martin Hanby Texas A&M University-Central Texas

DOI:

https://doi.org/10.33423/jabe.v22i1.2714

Keywords:

Business, Economics, Private Equity, Thomson Reuters Venture Capital, Thomson Reuters Buyout indices

Abstract

We use the Thomson Reuters Venture Capital and Thomson Reuters Buyout indices as proxies for U.S. Private Equity (PE) performance and compare them to U.S. stocks and bonds. Both PE indices have outperformed stocks and bonds and they have higher average and median monthly returns. However, PE indices also had higher risk compared to stocks and bonds. On a risk-adjusted basis, PE has outperformed stocks but underperformed bonds. PE has also created more wealth compared to stocks and bonds. Both the PE indices also have significantly positive four-factor alpha. Our results indicate that PE has created tremendous value.

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Published

2020-03-24

How to Cite

Kanuri, S., & Hanby, M. (2020). Private Equity (PE) Performance in The United States. Journal of Applied Business and Economics, 22(1). https://doi.org/10.33423/jabe.v22i1.2714

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Section

Articles