The best ways to invest in private equity

Cheap debt and high fees have been a winning formula for private equity. Investors should consider buying the fund managers as much as the funds, says Frederic Guirinec

Private equity is now firmly part of the investment mainstream, thanks to a record of strong returns. Over the last ten years, European buyout funds have achieved an annual return (as measured by internal rate of return, or IRR) of 15%, according to the European Private Equity and Venture Capital Association. By comparison, the FTSE 250 index – a proxy for the type of mid-sized companies that these funds often invest in – has managed a total return of just 8.8%.

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Frederic is an investment analyst. He started his career at JP Morgan in Paris. He has more than ten years of experience investing in private equity and also worked with the 3i debt management team investing in private debt. He is an ACCA member and a CFA charterholder. He graduated from Edhec Business School.