The Private Equity Secondaries Market During the Financial Crisis and the “Valuation Gap”
This descriptive paper analyzes the performance of the private equity secondaries market during the financial crisis 2008-2009, in order to understand the effective liquidity of private equity investments during this episode of market stress. We document that the secondaries market followed the development of the crisis very closely, with effective market liquidity contracting in early 2009 to only a fraction of the volume earlier, and a quick recovery afterwards that showed no signs of more protracted turbulences than the stock market. We argue that the particular form of illiquidity in the secondaries market can be best understood as the cumulative effect of behavioral and accounting-based elements. The available evidence indicates that the liquidity and the relative resilience of the secondaries market are efficient.
|Date of creation:||Apr 2011|
|Date of revision:|
|Publication status:||Published in The Journal of Private Equity 3.14(2011): pp. 42-54|
|Contact details of provider:|| Postal: |
Web page: http://mpra.ub.uni-muenchen.de
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Josh Lerner & Antoinette Schoar & Jialan Wang, 2008.
"Secrets of the Academy: The Drivers of University Endowment Success,"
NBER Working Papers
14341, National Bureau of Economic Research, Inc.
- Josh Lerner & Antoinette Schoar & Jialan Wang, 2008. "Secrets of the Academy: The Drivers of University Endowment Success," Journal of Economic Perspectives, American Economic Association, vol. 22(3), pages 207-22, Summer.
- George A. Akerlof, 2009. "How Human Psychology Drives the Economy and Why It Matters," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 91(5), pages 1175-1175.
- Francis A. Longstaff, 2002.
"The Flight-to-Liquidity Premium in U.S. Treasury Bond Prices,"
NBER Working Papers
9312, National Bureau of Economic Research, Inc.
- Francis A. Longstaff, 2004. "The Flight-to-Liquidity Premium in U.S. Treasury Bond Prices," The Journal of Business, University of Chicago Press, vol. 77(3), pages 511-526, July.
When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:39550. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ekkehart Schlicht)
If references are entirely missing, you can add them using this form.