Take advantage of Private Equity’s attractive risk/return

This video highlights one of the key arguments in favor of private equity: its historically attractive risk-return profile. Despite significant illiquidity constraints—with capital committed over the long term—private equity has historically outperformed public markets over the long term, with an estimated average spread of between 500 and 700 basis points per year.This outperformance is not limited to a simple illiquidity premium. It is accompanied by strong absolute performance, as private equity has historically generated average long-term returns of around 10% to 15% per year. In an environment marked by inflation, volatility in public markets, and lower returns across other asset classes, this ability to combine performance and stability is a key differentiator. The video also highlights private equity’s resilience across economic cycles. Over several decades, private equity cohorts have posted positive average returns, even during major recessions. This trend is largely due to the funds’ ability to invest in high-quality assets at more attractive valuations when markets are under pressure.Private equity thus exhibits a degree of decorrelation from public markets. When public markets decline sharply, certain private equity cohorts may, on the contrary, benefit from more favorable entry conditions, provided that managers possess the necessary discipline and investment capacity. This characteristic makes it a particularly attractive tool for asset diversification.The combination of performance, lower volatility, and decorrelation explains why institutional investors and high-net-worth families allocate a significant portion of their portfolios to private equity.