Wall Street's New Approach to Analyzing Private Market Returns

Reported about 1 month ago

Private market investments are facing challenges due to high borrowing costs and regulatory scrutiny, leading to a renewed focus on how to measure their performance. Quantitative analysts, like Barry Griffiths, are developing methods such as 'direct alpha' to better understand returns in these opaque markets. This approach involves comparing cash flows of private funds to public equity benchmarks, revealing insights about performance that could influence investment strategies. With private equity expected to grow significantly in the coming years, the demand for clearer analytics could reshape how these investments are evaluated.

Source: YAHOO

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