(1) Private equity returns vs. (2) public equity returns... my notes are contradictory:
- (1) has a low correlation with (2), when measured with short-term returns
- (1) has strong positive correlation with (2), when measured with less-frequently-measured returns
So, I would conclude that PE doesn't have much diversification benefit? because high positive correlation with public equities
Thoughts?作者: liangfeng 时间: 2011-7-11 19:59
yes PE do not have high diversificatiom benefits but can provide you return more than stocks and bonds作者: IAmNeil 时间: 2011-7-11 19:59
thx pupdawg.. makes sense作者: wake2000 时间: 2011-7-11 19:59
Looking over my notes and I have PE having a high correlation with equity markets since you are buying and selling companies at any given point in that market but it being a very good return enhancer for those with higher risk tolerance and longer time horizons.
