ALJA, Private Equity and Venture Capital Funds Extended String of Positive Quarterly Returns to nine
The private equity index benefited from solid public market returns and rising commodity prices, which boosted company-level performance.
- (1888PressRelease) September 06, 2011 - The last quarter is the ninth in a row to yield positive returns for ALJA, private equity and venture capital funds. Private equity continued to outperform venture capital over the five- and 10-year periods, while the situation remained reversed for the 15- and 20-year periods ending on the same date, with venture capital far out-distancing private equity.
The private equity index benefited from solid public market returns and rising commodity prices, which boosted company-level performance. Venture capital returns were aided in large part by an improving exit environment and continued enthusiasm for technology, the index's largest sector by weight. Both fund classes generated lower returns for the first quarter than they did in the quarter prior. Private equity funds earned 5.4% for the quarter, vs. 7.6% in the final quarter of 2010; venture capital earned 5.0%, vs. 8.4% for the prior quarter.
Over the 10-year period, private equity funds earned 10.8% and venture capital -0.1%. The 10.9% spread between these returns was almost a full point less (down from 11.7%) than the prior quarter. The venture capital return for the period, while negative, was up sharply from the -2.0% return for the same length period ending December 31, 2010, and it was a full 4.5% improvement over the low point for the 10-year venture capital return, which was reached during the quarter ending September 30, 2010.
The performance of consumer companies reflected the mixed nature of the difficult economic recovery. Because these companies are popular with fund managers as investment targets, the consumer sector comprised almost 21% of the private equity index, making it the largest of the eight meaningfully-sized sectors in the index. During the first quarter it was also the weakest performer, earning only 1.9%. The second lowest performing sector, information technology, generated a 4.8% return. Media was the best performing of the significantly-sized sectors, returning 7.9%.
:About ALJA (Anderson, Lloyd, Jones & Associates):
Anderson, Lloyd, Jones & Associates (ALJA) is a venture capital and management consulting firm. We invest in and provide management consulting services (including investor relations services) to early stage emerging growth companies and to microcap and smallcap public companies. We aim to form a close partnership with a company, developing relationships with management, investors and shareholders. We inform the investment community about a company, provide a management consulting to grow the business, and often take an equity stake in companies we assist.
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