Vintage year in the private equity and venture capital industries refers to the year in which a fund began making investments or, more specifically, the date in which capital was deployed to a particular company or project.[1][2] This metric is useful for benchmarking, identifying trends, estimating the holding period, and controlling returns for the effect of business cycles.[3]
Most likely, the term vintage year is borrowed from the winemaking industry, where it is also used to divide wines in comparable classes.
Overviewedit
The year of investing is an important and widely used metric to compare performance of the investments financed in the year in question against that of the investments financed in other years or against that of the general market (S&P 500). As the external market conditions change following the overall business cycle,[3] so does performance of investments. Therefore, returns of 50% on investments done in good years are not directly comparable to returns of 10% done in crisis years. That is why a vintage year is taken into account.[4] The returns are comparable if investments share approximately the same timing.
Referencesedit
^"Private Capital Markets - Data & Insights - VC Experts". Retrieved 24 February 2015.
^"Private Equity Performance". Retrieved 24 February 2015.
^ ab"Vintage Year". Investopedia. Retrieved 24 February 2015.
2012 could be a good vintage year for private equity investments
Private Equity: The Propaganda versus the Facts
Measuring returns in Private Equity
Equity Release Calculator
January 01, 1970
vintage, year, private, equity, venture, capital, industries, refers, year, which, fund, began, making, investments, more, specifically, date, which, capital, deployed, particular, company, project, this, metric, useful, benchmarking, identifying, trends, esti. Vintage year in the private equity and venture capital industries refers to the year in which a fund began making investments or more specifically the date in which capital was deployed to a particular company or project 1 2 This metric is useful for benchmarking identifying trends estimating the holding period and controlling returns for the effect of business cycles 3 Contents 1 Origin 2 Overview 3 References 4 External linksOrigin editMost likely the term vintage year is borrowed from the winemaking industry where it is also used to divide wines in comparable classes Overview editThe year of investing is an important and widely used metric to compare performance of the investments financed in the year in question against that of the investments financed in other years or against that of the general market S amp P 500 As the external market conditions change following the overall business cycle 3 so does performance of investments Therefore returns of 50 on investments done in good years are not directly comparable to returns of 10 done in crisis years That is why a vintage year is taken into account 4 The returns are comparable if investments share approximately the same timing References edit Private Capital Markets Data amp Insights VC Experts Retrieved 24 February 2015 Private Equity Performance Retrieved 24 February 2015 a b Vintage Year Investopedia Retrieved 24 February 2015 Returns and IRRs an explanationExternal links edit2012 could be a good vintage year for private equity investments Private Equity The Propaganda versus the Facts Measuring returns in Private Equity Equity Release Calculator Retrieved from https en wikipedia org w index php title Vintage year amp oldid 1155461932, wikipedia, wiki, book, books, library,
