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Proportion Of Private Equity Investors Making Fund Commitments Falls Over Past Year

Proportion Of Private Equity Investors Making Fund Commitments Falls Over Past Year by Preqin

Preqin’s latest analysis of investor activity in private equity has revealed a notable drop in the proportion of investors making fund commitments. During the first half of 2014, 62% of institutional investors globally surveyed by Preqin made investments in funds, but this proportion has fallen to 52% from Preqin’s most recent survey at the end of H1 2015. Investors may be holding back on new commitments given the record high levels of dry powder in the industry, which currently stands at $1.3tn.

Positive Outlook Despite Slowing Investor Activity

The first half of 2015 has seen a further increase in the levels of private equity dry powder available for fund managers to invest, with $965bn* in uncalled capital at the start of July 2015. With such large levels of unspent capital, fundraising and investor activity seems to have slowed slightly in H1 2015. LPs may be putting off investments while they wait for previously committed capital to be put to work. Despite this, attitudes towards the asset class remain positive, with the vast majority (87%) of investors reporting that their private equity investments have either met or exceeded expectations in the past year. In fact, only 11% of investors surveyed indicated they are looking to invest less capital in private equity compared to 12 months before, the smallest proportion across all asset classes.

This shows that LPs are still willing to commit significant amounts of capital to fund managers and it is therefore...


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