Alternative Assets on Sale
Just like everything else.
From the New York Times.
Some of the nation’s universities are trying to sell chunks of their
portfolios privately as their endowments swoon with the markets.
Among institutional investors, school endowments aggressively embraced private equity, real estate partnerships, venture capital, commodities, hedge funds and other so-called alternative investments over the last few years. Endowments with more than $1 billion in assets reported 35 percent of their holdings in these types of investments on average last year, a much greater portion than big public pension funds, for example. ...
Last year, the average seller got $1.04 for every dollar of face value, according to a report by Cogent Partners, an investment bank for institutions looking to sell such holdings in the secondary market. Since June, sellers have been getting 50 cents or less on the dollar, said Colin S. McGrady, a managing director at Cogent.
Among institutional investors, school endowments aggressively embraced private equity, real estate partnerships, venture capital, commodities, hedge funds and other so-called alternative investments over the last few years. Endowments with more than $1 billion in assets reported 35 percent of their holdings in these types of investments on average last year, a much greater portion than big public pension funds, for example. ...
Last year, the average seller got $1.04 for every dollar of face value, according to a report by Cogent Partners, an investment bank for institutions looking to sell such holdings in the secondary market. Since June, sellers have been getting 50 cents or less on the dollar, said Colin S. McGrady, a managing director at Cogent.
I love markets (though admittedly, I have not been so much in love with markets over the past few weeks). The psychology of herds as manifested in financial markets fascinates me.
Over the past several years, the herd had been stampeding into alternative assets as institutions all tried to emulate Harvard and Yale, which put up some gaudy numbers when markets were getting creamed.
Now, unsurprisingly, after pouring an ocean of liquidity into alternatives, which lead to many really stupid deals, pieces are being sold off at 50 cents on the dollar.
We all can't be Harvard and Yale.
The cycle of greed and fear never ends.
»
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