WASHINGTON – Today, the American Investment Council (AIC) released its new 2017 Q3 Performance Update Report that showed private equity funds continue to outperform public markets over the long term.
“The long-term outperformance of private equity funds provides an excellent investment opportunity for pension funds representing teachers, firefighters, and other public servants seeking retirement security,” said AIC President and CEO Mike Sommers. “Despite the recent strength of the stock market, investors in private equity generally received greater returns from these investments than public equities over the last ten years.”
According to the report, annualized private equity investments outperformed the Russell 3000 and the S&P 500 Index with dividends by 2.1 and 2.3 percentage points, respectively, over the 10-year time frame ending September 30, 2017. A surge in public markets this year led to private equity trailing these markets by 1.5 and 0.9 percent for one-year returns.
“The private equity model is patient capital that provides greater returns and lower volatility than the stock market,” said Bronwyn Bailey, AIC’s Vice President of Research and Investor Relations. “Our report shows the median private equity benchmark of 9.7 percent annualized returns over a 10-year period far exceeded the performance of three major U.S. indices during the same time frame,” she said.
Read the full report here.