Over the past 12 months or so, the disconnect between the net asset values of a wide range of investment companies and their share prices has widened considerably.
The problem seems particularly acute in the area of alternative assets, which includes private equity, property, infrastructure and renewable energy infrastructure. Discounts on private equity funds are extreme. Large, liquid, well-diversified funds with good track records such as HarbourVest and Pantheon International are trading at around half their underlying value. The best-performing of all investment companies over the past five years (up about 185%) is Oakley Capital Investments, yet even it is trading on a 29% discount to its net asset value. It feels as though there is ...
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