VFMC likes private equity, has a modest allocation

Victorian Funds Management Corp. says its private equity investments have been a useful adjunct to its portfolio but they are not seeking to bolster their allocation to such investments.

“I don’t need to tell you that markets have been volatile but private equity has given a smoother valuation cycle,” says Justin Arter, chief executive officer of VFMC, which provides investments and funds management services to Victorian public authorities.

“Being in the right syndicates has obviously been critical,” he says.

VFMC’s private equity investments have made a 6.5 per cent annual return in the five years to September 30, 2011 compared with Australian equities which had a negative 1.4 per cent yearly return over the same period. Private equity comprises 3.9 per cent of VFMC’s $34.5 billion in assets under management as of September 30.

“Being modest in private equity we think is appropriate,” says Arter. “We’re akin to the Future Fund and interested in growing slowly and steadily.”

Conexus, the publisher of i&t News, will host a private equity conference for investors in Melbourne on February 21 at the Park Hyatt.

To view the agenda, please click the following link http://privatemarkets2012.floktu.com/