Private equity fofs dare to hope for revival

Private equity fund of funds, which delivered stellar returns from 2004 to the end of December 2007, are poised to resume their activity after the sector imploded following the Lehman Brothers collapse in 2008.

Provided markets are not subject to a double-dip recession,  the sector will be able to use the post-recession period as a buying opportunity, according to Ian Barrass, head of fund of funds at Henderson Equity Partners, the private equity arm of Henderson Global Investors. “Funds raised just after a recession tend to do well because entry prices are lower and they can eventually make good returns,” notes Barrass, who manages the £56m Henderson Private Equity investment trust as part of his fund of funds’ responsibilities. Instead of rushing into gold or China funds, now being heavily...