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<blockquote data-quote="ebitda" data-source="post: 72448" data-attributes="member: 2866">I think some care needs to be taken when defining private equity. These days the phrase has been used so broadly that it can come to mean a lot of different things nowadays!At its core, private equity (if you're thinking of your classic LBO vehicles) belongs to the alternative investment family and by virtue of that, does not fall within the conventional capital markets. Much like stocks, bonds or other securities, private equity is an asset class on its own. They are illiquid, relatively unregulated and have much different risk/return/time horizon profiles than your typical primary market securities (stocks, bonds). It's precisely because private equity doesn't raise capital from the public markets which gave rise to its name in the first place!Where the equity capital markets come into play is how the fund itself operates and executes its transactions. Of course private equity funds can acquire publicly-traded shares (PIPEs) or exit their investments via an IPO. These processes involve participating in the equity markets, but I think to classify PE as belonging to ECM might be a slight misnomer (in the same way how you wouldn't classify a hedge fund as part of ECM or DCM even though they trade in equities/bonds!). If you're talking about private equity in the sense of shares in private companies, then that would perhaps fall under ECM. In practice however, these private shares wouldn't be termed as private equity because nowadays PE denotes a completely different mammoth asset class as mentioned!</blockquote>

[QUOTE="ebitda, post: 72448, member: 2866"] I think some care needs to be taken when defining private equity. These days the phrase has been used so broadly that it can come to mean a lot of different things nowadays! At its core, private equity (if you're thinking of your classic LBO vehicles) belongs to the [U]alternative investment[/U] family and by virtue of that, does not fall within the conventional capital markets. Much like stocks, bonds or other securities, private equity is an asset class on its own. They are illiquid, relatively unregulated and have much different risk/return/time horizon profiles than your typical primary market securities (stocks, bonds). It's precisely because private equity doesn't raise capital from the public markets which gave rise to its name in the first place! Where the equity capital markets come into play is how the fund itself operates and executes its transactions. Of course private equity funds can acquire publicly-traded shares (PIPEs) or exit their investments via an IPO. These processes involve participating in the equity markets, but I think to classify PE as belonging to ECM might be a slight misnomer (in the same way how you wouldn't classify a hedge fund as part of ECM or DCM even though they trade in equities/bonds!). If you're talking about private equity in the sense of shares in private companies, then that would perhaps fall under ECM. In practice however, these private shares wouldn't be termed as private equity because nowadays PE denotes a completely different mammoth asset class as mentioned! [/QUOTE]

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