Metrics usually tracked for Private Equity
Private Equity is an important Asset Class for our customers. Typically the following metrics are tracked
Internal Rate of Return (IRR)
IRR, the performance metric of choice in the PE industry, represents the discount rate that renders the net present value (NPV) of a series of investments zero. IRR reflects the performance of a private equity fund by taking into account the size and timing of its cash flows (capital calls and distributions) and its net asset value at the time of the calculation.
Distributed to Paid-In Ratio (DPI)
It represents the amount of capital returned to investors divided by a fund’s capital calls at the valuation date. DPI reflects the realized, cash-on- cash returns generated by its investments at the valuation date
Total Value to Paid-In Ratio (TVPI)
It represents the amount of capital returned to investors + a fair value of the stakes that the fund still holds in its portfolio companies, divided by a fund’s capital calls at the valuation date. TVPI reflects the total (i.e. realized and unrealized) returns generated by its investments at the valuation date
Kaplan Schoar Public Market Equivalent (KS-PME)
The Kaplan Schoar PME measures the wealth multiple effect of investing in the PE fund versus the index. It represents the market-adjusted equivalent to the traditional TVPI. A value greater than 1 implies that the fund outperformed the public benchmark
The index used for this analysis is user configurable. It can be any public index (e.g. S&P 500 or EuroStoxx 50), any particular fund or model portfolio or even a blend (e.g. 60% S&P 500 and 40% Barclays Agg)
Direct Alpha
Same methodology as KS-PME, except the underperformance/outperformance is expressed as a percentage instead of a multiple
Sample Dashboards
Canopy is able to support all sorts of Dashboards. Some of the more popular ones are
Data by Vintage and Geography
Detailed Data in Tabular Format
DPI and TVPI
In this dashboard each fund is shown as a bubble on a X-Y chart.
Size of the each bubble corresponds to the prevailing market value of each fund
DPI on X-axis
TVPI on Y-axis
IRR and Public Market Equivalent
In this dashboard each fund is shown as a bubble on a X-Y chart.
Size of the each bubble corresponds to the prevailing market value of each fund
IRR on X-axis
PME on Y-axis
IRR and Absolute Profit
In this dashboard each fund is shown as a bubble on a X-Y chart.
Size of the each bubble corresponds to the prevailing market value of each fund
IRR on X-axis
Actual Profit (in Base Currency of the Account) on Y-axis
PME Over Time
This chart shows the evolution of Public Market Equivalent over time for each fund.
J Curve
J Curve is a cumulative summation of all outflows and inflows in the base currency of the account
