Institutional Investment in Listed Private Equity
European Financial Management, Forthcoming
30 Pages Posted: 14 Dec 2010
Date Written: December 13, 2010
This paper examines institutional investors’ propensity to invest in a relatively unknown asset class of listed private equity. Based on data provided by LPEQ, Preqin and Scorpio Partnership covering 171 institutional investors in Europe in 2008-2010, we find allocations are primarily a function of size, type, location, decision-making authority and liquidity preferences. Investment in listed private equity is more commonly made by institutions that are smaller, private (not public) pension institutions, institutions that have a preference for liquidity, quick access, and administrative and cash flow management simplicity, and institutions that are based in the UK, Switzerland, Sweden and the Netherlands. As well, institutions are less likely to invest in listed private equity when investment decision-making is empowered to an alternative asset class team.
Keywords: Institutional investment, pension funds, listed private equity
JEL Classification: G23, G24
Suggested Citation: Suggested Citation