Global Perspectives on Venture Capital and Private Equity

Xiaoqing Eleanor Xu
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Xiaoqing Eleanor Xu: Stillman School of Business, Seton Hall University, 400 South Orange Avenue, South Orange, NJ 07079, USA

Chapter 8 in Advances in International Investments:Traditional and Alternative Approaches, 2008, pp 187-209 from World Scientific Publishing Co. Pte. Ltd.

Abstract: AbstractPrivate equity encompasses all types of equity investments in non-publicly traded companies, such as venture capital and buyout investing. Venture capital funds specialize in long-term private equity investments in startup and super-growth companies that offer high potential returns and substantial risks, while buyout funds invest in established businesses that need financing capital for the change of ownership. Global venture capital and buyout funds provide investors with the opportunity to capture innovations and growth around the world while enjoying the enhanced return potential and risk diversification. Major private equity hotbeds include the established markets of Europe, Israel, Canada, and the emerging markets of China, India, and Russia. While PE investments provide superior return relative to public equity, they are also associated with illiquidity and various other risks. As an alternative investment asset class, investors need to assess its risk and return profile carefully before making the asset allocation decision.

Keywords: Global Investment; Traditional and Alternative Investments; Equity Investments; Fixed Income Investments; Portfolio Management; Derivatives; Risk Management (search for similar items in EconPapers)
JEL-codes: F3 G21 (search for similar items in EconPapers)
Date: 2008
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