Preqin Launches Advanced Benchmarking Tools for Private ...

1 New York: One Grand Central Place, 60 E 42nd Street, Suite 630, New York NY 10165 Tel: +1 212 350 0100 London: 3rd Floor, Vintners Place, 68 Upper Thames Street, London EC4V 3BJ Tel: +44 (0)20 3207 0200 Singapore: One Finlayson Green, #11-02, Singapore, 049246 Tel: +65 6305 2200 San Francisco: 1700 Montgomery Street, Suite 134, San Francisco, CA 94111 Tel: +1 415 835 9455 Web: / Press Release 22nd July 2015 Preqin Launches Advanced Benchmarking Tools for Private equity performance Preqin s Public Market Equivalent (PME) Tools provide directly comparable returns with public markets to allow for more meaningful, like-for-like performance comparisons Investors and fund managers alike frequently benchmark Private equity returns against public markets in order to gauge the relative performance of their investments.

2 For investors, it is an important exercise to undertake to inform portfolio construction decisions and to evaluate the performance of one asset class against another. For fund managers, it forms a key aspect of fund marketing to help secure investor commitments. Private equity returns, however, are not directly comparable with public market indices, due to the asset class s illiquid nature and irregular timing of cash flows. To aid the industry in Benchmarking performance , Preqin has launched a new PME tool which offers benchmark and fund-level comparison against six public market indexes using a choice of three PME methodologies: the Kaplan-Schoar PME, the Long-Nickels PME, and the Capital Dynamics PME+.

3 These Tools overcome the Benchmarking difficulties by accounting for the timings of fund cash flows in a public market index, and can be used to analyze and compare Private equity performance with public markets. Overall, these methodologies confirm Private equity s ability as a whole to outperform public markets over the longer term, but also highlight specific key findings: Compared to the S&P 500 total return index, the Kaplan-Schoar PME shows that investors in a typical 2004 vintage Private equity fund are 25% better off than if they had the same cash flows in the public market over the same period.

4 When looking at the Long-Nickels PME and Capital Dynamics PME+, 2002 vintage funds stand out in particular. These funds have the highest median net IRR of , compared with a PME+ value of and an LN PME of For buyout funds specifically, 2000 vintage funds have returned 63% more than the public market over the same period to 31 December 2014 when compared against the Russell 3000 total return index using the KS PME methodology. For the same vintage and methodology, venture capital funds underperformed the public market (Russell 2000 index) by 48%. For more information and analysis, please see the full report via the link below: Comment: Private equity returns are not directly comparable with public market indices, given the asset class s illiquid nature and irregular timing of cash flows.

5 As such, the industry has long used the analogy of comparing apples with oranges when discussing these difficulties. Preqin is delighted to announce the addition of PME benchmarks and individual fund level PME comparisons to its performance Analyst service, which already provides net-to-LP fund performance metrics for over 7,600 named vehicles globally. This will provide users, and particularly investors, with an essential tool for analyzing Private equity returns, specifically as an alternative measure of ranking fund performance while controlling for broader market behaviour. Christopher Elvin Head of Private equity Products, Preqin _____ About Preqin : Preqin is the leading source of information for the alternative assets industry, providing data and analysis via online databases, publications and bespoke data requests.

6 New York: One Grand Central Place, 60 E 42nd Street, Suite 630, New York NY 10165 Tel: +1 212 350 0100 London: 3rd Floor, Vintners Place, 68 Upper Thames Street, London EC4V 3BJ Tel: +44 (0)20 3207 0200 Singapore: One Finlayson Green, #11-02, Singapore, 049246 Tel: +65 6305 2200 San Francisco: 1700 Montgomery Street, Suite 134, San Francisco, CA 94111 Tel: +1 415 835 9455 Web: / Preqin has built a reputation in the alternative assets industry for providing the most comprehensive and extensive information possible. Leading alternative assets professionals from around the world rely on Preqin s services daily, and its data and statistics are regularly quoted by the financial press.

7 For more information, please visit: Note to Editors: Preqin is spelled without the letter U after the Q . For more information, please contact: Christopher Elvin +44 (0)20 3207 0256 or For general press information, please contact: Nicholas Jelfs +44 (0)20 3207 0282 or