engleski

Applied regression analysis for private equity funds

ABSTRACT From the perspective of today's investors, it is encouraging to search for optimal subset of solutions and opportunities for propulsive investments on capital markets. Imbalances between valuation methods, performance ratios and investors’ expectations in different investment phases of the private equity represent incentives for pension or private funds under the given financial discipline. In this paper, the concept and the role of committed capital follow basic terminology of limited partners toward the distribution of general partners’ investments with its multiples and residuals paid-in. The linear regression model for the most promising private equity funds (456) for 19 periods on a global scale emphasize the dry powder function. The results of the authors’ model, shown by data from Preqin Pro database, indicates growing risk aversion criteria through the realized gains of residuals or distribution of capital to general partners for the last decade. Additional findings with simple cases explain the performance ratios as a measure in predicting the total cost of ownership in the discussion part. Researched gaps with solutions on mentioned findings provide insight for empirical analysis of general partner and its experienced international investors. Predefined criteria that support findings is related to fund capitalisation, called up capital, distribution to paid-in capital, residual value to paid-in capital, total value to paid-in capital and its multiple ratios. In the conclusion part, the authors shall summarise all useful findings related to the area of interest and studies in science and business.

capital markets ; distribution of capital ; linear regression ; private equity ; total cost of ownership

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