New Report: Private Equity Outperforms Public Markets Across the Short and Long-Term

WASHINGTON – The American Investment Council’s Q1 2018 Performance Update shows that private equity returns surpassed public markets across the 1-, 3-, 5-, and 10-year horizon benchmarks. Private equity’s largest outperformance came at the 1-year benchmark, where it had 2.4 percent higher median returns at 14.4 percent.











The Performance Update shows that median private equity benchmark returns outpaced the S&P 500 Index without FAANG companies (Facebook, Apple, Amazon, Netflix, and Google/Alphabet), excluding dividends by even greater margins:

  • 6 percent (1-year benchmark)
  • 4.6 percent (3-year benchmark)
  • 3.3 percent (5-year benchmark)
  • 3.3 percent (10-year benchmark)

This quarter’s report also shows that median private equity returns outperformed the AIC benchmark and the S&P 500 index for 1-, 3-, and 5-year horizons in the first quarter of 2018.

Private equity is the best performing asset class for many of its investors, including public pensions. Our earlier released 2018 Public Pension Study, which analyzed 2017 returns for 163 pensions, showed private equity’s median 10-year annualized return beat public markets by 2.5 percent.

Our quarterly Performance Updates provide a median private equity benchmark return that pulls from BISON, Cambridge Associates, CepreX, Institutional Limited Partners Association (ILPA), and State Street and compares to the Russell 3000 Index (including dividends) and S&P 500 Index (including and excluding dividends as well as without FAANG, excluding dividends).

Read the full report here.