Hunting for double-digit returns with lower levels of risk

The private equity (PE) space has grown dramatically in recent years, in both scale and access. Despite this growth, only one diversified PE investment is available on the ASX: the Pengana Private Equity Trust, trading under the ticker PE1. 

Private equity is a broad asset class with many different investment strategies, including venture capital, growth, buyouts and distressed opportunities. Traditionally, PE was only available to high-net-worth investors and large family offices, but PE1 solves many of the problems associated with PE - namely access and liquidity. 

The other issue? Expertise. It's one thing to have access to an opportunity. It's another to have the requisite knowledge to play in the space. According to Pengana Capital co-founder and CEO Russel Pillemer, PE1 offers that.

He adds that while PE1 has in excess of 450 underlying exposures, getting "into the right private equity managers, on the lookout for good companies with high cash flows" is the key. 

Such diversification and expertise "should be able to earn mid-teens type of returns over time - significantly more than you could earn in listed equity markets," says Pillemer.

While Pillemer is keen to point out that Pengana focuses on companies that are stable and consistent, rather than particularly exciting, he nominates Elon Musk's SpaceX as one investment that stands out from the pack. 

In the following Fund in Focus, Pillemer shares more about the philosophy behind PE1, where he sees the best opportunities currently, why a long-term focus is important, and why private markets offer a more compelling opportunity than public markets. 

• Name: Pengana Private Equity Trust (ASX: PE1)
• Asset Class: Alternative Assets
• Investment objective: The Pengana Private Equity Trust is Australia’s only listed portfolio of diversified global private market investments, managed by Grosvenor Capital Management L.P, one of the largest and longest continually operating allocators to alternative investments globally. 
• Link to fund page: click here

Please note that this interview was filmed on 26 March 2024.

Timestamps

0:00 - Intro
0:16 - Why list on the ASX
1:12 - The philosophy behind PE1
2:04 - Where are the best PE opportunities
3:17 - A matter of liquidity
5:07 - Private vs public markets
6:53 - Target investors and time horizons
8:05 - PE into the future

Access to Australia's only Global Private Equity stock

The Pengana Private Equity Trust (ASX: PE1) is a diversified portfolio of global private equity investments, managed by one of the largest and longest continually operating allocators to alternative investments in the world. Visit their website to learn more. 

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Pengana Private Equity Trust (PE1)

Alternative Assets

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