The Growth and Impact of Private Equity Investments

Private equity has been growing for 35 years, leading to a higher number of companies owned by private equity. This trend has attracted more investors, particularly institutional ones like state pension funds and college endowments. These investors allocate a percentage of their assets to private equity and monitor the value of their investments closely. A significant increase in the value of private equity investments can lead to over-allocation, posing both positive and negative consequences for the investors.