The state of private investing

There has been no shortage of public discussion on the state of the world’s public stock markets. Even President Trump himself hasn’t hesitated to boast about the rapid rise of stock indexes during his time in office.

However, as we’ve been constantly preaching on these very pages, the stock markets provide a very shallow and short-term snapshot of the investment environment. Instead, long-term investors should look at other pieces of information, which is what we’ll do presently.

A rising trend continues

For example, according to a report issued by global consulting firm McKinsey & Company, titled McKinsey Global Private Markets Review 2018: The rise and rise of private markets, which was released in February of 2018, although the rise in the public markets was well documented for the period in review, with the S&P rising by about 20 percent, for example, the private markets kept up the pace, too. Specifically, for the period in review, private asset managers raised a total of almost $750 billion globally, which furthers an upward trend that began eight years previously.

On the local front, the Canadian Venture Capital and Private Equity Association (CVCA) in September of 2018 released its review of Canadian private equity and venture capital, and came up with a number of positive findings. Specifically, venture capital investment continues to rise in Canada, with $1.7 billion raised across 308 venture-capital deals for the first half of 2018, which represents a seven-percent increase from the previous year. This continues a five-year positive trend in terms of size and volume.

All’s well on the local front

In addition, the CVCA reported a robust market for private investment for both early-stage and established firms, with the backdrop of a high-growth and low-interest landscape combined with a high level of “dry powder” (highly-liquid marketable securities or large amounts of cash reserves) boding well for the country’s private-investing sector.

ASCEND GRP is an asset-management firm, with offices in Toronto, Richmond Hill, and New York, that services clients seeking investment opportunities worldwide.

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