Private Equity
Private Equity refers to the holding of stock in unlisted businesses. Unlisted businesses generally require access to investment capital to fund growth or to provide liquidity for existing shareholders. More specifically, unlisted companies may require private equity to fund the development of a start-up or early stage business (venture capital), to expand or grow an established business either organically or by acquisition, to facilitate a management buy out or buy in, or to allow existing shareholders to make a partial or full sell-down of their holdings.
A Private Equity fund or company enables the public to invest in these unlisted businesses, which would normally be out of reach (due to the high amount of capital required).
Compared to investments in listed companies, private equity investments are relatively illiquid, but offer potentially higher returns. Incorporated as part of an investment portfolio, private equity can provide investors with greater diversification within their portfolio and less portfolio volatility.
Learn more about Private Equity, go to http://pohutukawafund.co.nz.