Secondaries was top performing strategy in Q3

Secondaries was one of only three strategies to generate positive IRRs on a quarterly basis alongside European private equity and venture capital funds.

Secondaries funds delivered higher returns than any other strategy in the third quarter of last year, according to data from the Institutional Limited Partners Association (ILPA).

The ILPA Secondaries benchmark generated a pooled net internal rate of return (IRR) of 1 percent on a quarterly basis, one of only three strategies to deliver positive returns during the quarter, according to the Q3 2015 ILPA Private Markets Benchmark. Secondaries also recorded a year on year rise, beating the 0.56 percent IRR delivered during the third quarter of 2014.

Secondaries also outperformed the negative 1.45 percent generated by the ILPA All Funds Index, which combines all strategies including private equity, venture capital and funds of funds.

US dollar-denominated European private equity and venture capital funds and its euro-denominated counterpart were the only other strategies that delivered positive returns, with 0.68 percent and 0.5 percent IRRs respectively.

The worst performing strategy on a quarterly basis was natural resources which generated a negative 8.16 percent IRR, followed by Asia-Pacific private equity and venture capital funds with negative 4.83 percent.

On a long-term basis, secondaries also delivered an above-average return with 11.36 percent across a 10-year period, compared with 11.13 percent for all funds.

The ILPA data is based on returns for 3,413 funds as of 30 September.

Source: ILPA.