Private equity investments offer longterm return potential from "summary" of Institutional Investment Management by Frank J. Fabozzi
Private equity investments are known for their long-term return potential. This characteristic is attractive to institutional investors seeking to achieve high returns over an extended period. Private equity investments typically involve purchasing equity ownership in private companies not listed on public stock exchanges. These investments are illiquid, meaning that investors commit their capital for a specified period, usually several years, before they can exit the investment. The long-term nature of private equity investments allows for the implementation of strategic initiatives to enhance the value of the underlying companies. Private equity managers work closely with company management to improve operational efficiency, expand market reach, and drive revenue growth. These value-enhancing strategies take time to materialize and deliver returns, hence t...
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