1 S&P Capital IQ, as of August 31, 2022. Analysis by J.P. Morgan.
2 Source: Burgiss Private iQ. Performance, as of December 31,2023, is private equity pooled industry performance, aggregated by Burgiss. The performance is net of fees and expenses charged by managers. Performance represents Time Weighted Returns as calculated using the Modified Dietz methodology, which is a money-weighted return that takes into account the timing of cash flows by using a weighting factor. The weighting factor of a cash flow is calculated as the difference between the date of the cash flow and the date of the end of the periods divided by the number of days in the period. Pooled results are calculated using the composite transaction (cash flow and valuation) activity of the underlying funds after being converted to a common currency, known as the Pooled Results Currency, which is defined within the Parameters tab of the Analysis toolbox. No additional weighting is applied to the underlying funds; the amount of the full fund transactions and their associated full fund valuations are used in calculations. Underlying funds with larger fund sizes may naturally have larger transaction and valuation amounts, thus having a larger impact on the pooled results.
For the avoidance of doubt, the performance shown is not reflective of PEG's historical performance and does not reflect PEG's investment strategy or the investment strategy of JPMF. Past performance is no guarantee of future results, and there can be no guarantee the performance shown will be achieved for investments that are not fully realized.
Leveraging strategic partnerships and networks built over 40+ years
Using our thorough due diligence process, we identify top-performing small and mid-market managers.
Small and mid-market buyouts make up a large part of the overall private equity market, with lower entry prices, less leverage and increased exit opportunities.
Acquiring interests in existing private equity funds from other investors.
Potential to mitigate J-curve and increase diversification given the ability to buy into existing portfolio.
Allows investors to invest directly into a private company alongside a private equity sponsor.
May offer attractive fee dynamics and ability to target sector diversification and concentration.
Investing in new funds formed by existing private equity sponsors.
The Private Equity Group is focused on small and mid-market managers that are attractive investments and difficult to access.
Providing individual investors simplified access to the Private Equity Group investment engine in the small and mid-market segment.
Plan and guide your client conversations with our resources on private equity investing.
1 As of 6/30/23. Includes tenure and investing experience at both PEG and AT&T Investment Management Corporation ("ATTIMCO"). Portfolio Management team average tenure represents voting eligible members of PEG. There can be no assurance that any or all of these professionals will remain with PEG, or that the past performance or success of any such professional serves as an indicator of his or her future performance or success.
Past performance is no guarantee of future results. Diversification does not guarantee investment returns and does not eliminate the risk of loss.
Risks of Private Equity Strategies
The Fund's investment portfolio will include exposure to private companies for which operating results in a specified period will be difficult to predict. Such investments involve a high degree of business and financial risk that can result in substantial losses.Private Equity Investment Risks. Private equity transactions may result in new enterprises that are subject to extreme volatility, require time for maturity and may require additional capital. In addition, they frequently rely on borrowing significant amounts of capital, which can increase profit potential but at the same time increase the risk of loss. Leveraged companies may be subject to restrictive financial and operating covenants. The leverage may impair the ability of these companies to finance their future operations and capital needs. Also, their flexibility to respond to changing business and economic conditions and to business opportunities may be limited. A leveraged company's income and net assets will tend to increase or decrease at a greater rate than if borrowed money was not used. Although these investments may offer the opportunity for significant gains, such buyout and growth investments involve a high degree of business and financial risk that can result in substantial losses, which risks generally are greater than the risks of investing in public companies that may not be as leveraged.Venture Capital Risks. Venture capital investments are in private companies that have limited operating history, are attempting to develop or commercialize unproven technologies or to implement novel business plans or are not otherwise developed sufficiently to be self-sustaining financially or to become public. Although these investments may offer the opportunity for significant gains, such investments involve a high degree of business and financial risk that can result in substantial losses, which risks generally are greater than the risks of investing in public or private companies that may be at a later stage of development.
Risks Associated with Private Company Investments
Private companies are generally not subject to SEC reporting requirements, are not required to maintain their accounting records in accordance with generally accepted accounting principles, and are not required to maintain effective internal controls over financial reporting. As a result, the Adviser may not have timely or accurate information about the business, financial condition and results of operations of the private companies in which the Fund invests. There is risk that the Fund may invest on the basis of incomplete or inaccurate information, which may adversely affect the Fund's investment performance. Private companies in which the Fund may invest have limited financial resources, shorter operating histories, more asset concentration risk, narrower product lines and smaller market shares than larger businesses, which tend to render such private companies more vulnerable to competitors' actions and market conditions, as well as general economic downturns. These companies generally have less predictable operating results, may from time to time be parties to litigation, may be engaged in rapidly changing businesses with products subject to a substantial risk of obsolescence, and may require substantial additional capital to support their operations, finance expansion or maintain their competitive position. These companies may have difficulty accessing the capital markets to meet future capital needs, which may limit their ability to grow or to repay their outstanding indebtedness upon maturity.Typically, investments in private companies are in restricted securities that are not traded in public markets and subject to substantial holding periods, so that the Fund may not be able to resell some of its holdings for extended periods, which may be several years. There can be no assurance that the Fund will be able to realize the value of private company investments in a timely manner.
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