Private Equity Gains as Hedge Funds Lag

The Wall Street Journal reports that as hedge funds lose some of their popularity amid poor performance and too many offerings, private equity is becoming more popular with advisers looking for diversification. Joe Dwyer, Portfolio Manager of  a Tech Focused Private Equity Fund based in Chicago and an adjunct professor at Northwestern’s Kellog School of Management says "private equity is often a more tangible way to increase alternative investment allocations."

On average, performance by hedge funds trailed the stock market since the financial crisis, as stocks have soared and competition among hedge funds has increased dramatically. 

Private equity ownership has a number of important advantages that allow it to create value and realize capital gain in a more repeatable, predictable fashion. Investors typically find private equity investments easy to understand. Many of these investors have been on the receiving end of these transactions themselves while running companies.

The potential company investments for private equity are enormous. They can invest in companies that are at the beginning of their growth cycle and in private hands.  They can invest in the less popular divisions of larger corporations or take private those public companies that are under performing in the stock markets.

Private equity firms invest in companies to make them more valuable than selling it to a buyer who appreciates that lasting value has been created. Private equity firms are therefore patient investors, unconcerned with short term performance.  

J.P. Dahdah

Vantage Self-Directed Retirement Plans, 20860 N Tatum Blvd Suite 240, Phoenix, AZ, 85050, United States

After graduating from The University of Arizona where he earned dual degrees in Finance and Marketing, Mr. J.P. Dahdah began his professional career in 1997 as a financial advisor with American Express Financial Advisors. In 1999, he founded Dahdah Global Wealth Management, LLC, a comprehensive wealth management company which specialized in working with business owners. In June 2004, Mr. Dahdah founded his second company, Entrust Arizona, LLC. Entrust Arizona provided self-directed retirement plan administration and custodial services to individuals and small business owners who desired to include non-traditional assets, such as real estate, as part of their tax-deferred and tax-free portfolios. Mr. Dahdah earned the Certified IRA Services Professional (CISP) designation by The Institute of Certified Bankers in 2007, and in 2009, he began hosting a weekly “Wealth Wednesdays” radio show on KFNN 1510AM. In that same year, the Arizona Small Business Association (ASBA) presented Entrust Arizona with “Arizona’s Companies to Watch” Award, an honor celebrating second-stage entrepreneurs. Experiencing an annualized revenue growth of 28%, Entrust Arizona’s client base grew to over 6,500 clients and $600M in retirement assets in less than seven years. A testament to the Company’s size, strength, and growth, Entrust Arizona re-branded and changed its business name to Vantage Retirement Plans, LLC, on January 3rd, 2012. Mr. Dahdah has been happily married since 2008 to his wife Erin and is the proud father of his daughter, Liliana Sofia and son, Juan Pablo II.