What Investors Need to Know to Value Private Portfolios: Interview with IPC’s Greg Brown

Gregory Brown, Research Director for the Institute for Private Capital and Professor of Finance at UNC Kenan-Flagler Business School recently spoke with CIO Magazine Executive Editor Amy Resnick about his research and what investors should know when valuing illiquid assets.

In the interview, Professor Brown discusses the limitations of traditional valuation methods when it comes to illiquid investments like private equity and venture capital. In response to this issue, he developed a statistical “nowcasting model” to provide more timely and accurate fair values.

“We’ve done large historical analyses to demonstrate that the prices that we get, those fair-value prices that we get from the nowcasting model, are better predictors of what future returns will be then the GP-reported NAVs.”

What do institutional investors need to know to accurately track their portfolios? How has the rise in evergreen funds, secondary market transactions, and continuation vehicles increased the need for real-time pricing? What is the next frontier for private assets? Read the full discussion at the link below.