GP and 3rd Party Valuation Settled Once and for All.

CFA Level II
#1

No arguments here, this comes straight from the CFAI texts so feel free to check me if you don’t believe me, this has no opinion and is verbatim: “Another important aspect of PE valuations is that they are mostly performed by GPs. Under the pressure from LPs, an increasing number of annual or semi-annual valuations are performed by independent valuers that are mandated by GPs.” CFAI Volume 5, pg. 67 (second to last paragraph in section 3.4 Private Equity Fund Valuation). Please stop arguing about this question now.

#2

crazy that anyone is still arguing about it, i saw the exact same except posted the day after the exam. -1 for me.

#3

excerpt*

#4

Nice…my real world experience helped me choose this answer but I’m glad there’s support in the text!

#5

what about the return time weighted or money weighted ?

#6

Sorry, super I didn’t see that and wanted to clear the issue up since I just saw people still arguing about it in another thread (hate to add useless topics to what is an already very busy front page on AF).

#7

@Bull: don’t know don’t care, sorry homey.

#8

PE returns are usually money weighted.

#9

Yes!!!

#10

Isn’t this the consensus? I am 5/6 in AI except fking Gross IRR

#11

nirjraina Wrote: ------------------------------------------------------- > PE returns are usually money weighted. Um, so what does that mean the answer was??

#12

I have no clue about the “answer”, but if you identify the relevant statements as true/false you should be ok.

#13

I thought we were talking about the gross IRR question - which true/false question are you talking about? I’m so confused right now…

#14

answer was B) time-weighted return

#15

LOL sorry we went off on a tangent about a different Q in the AI set. I got 12% for the IRR, I still think thats the right answer.

#16

Also 12% on gross IRR, but complete guess based on logic. Given the CFs presented there was no way that firm was earning just 4%.

#17

i thought IRR was money weighted

#18

supersharpshooter Wrote: ------------------------------------------------------- > i thought IRR was money weighted the question was asking for false statement.

#19

nirjraina Wrote: ------------------------------------------------------- > LOL sorry we went off on a tangent about a > different Q in the AI set. > I got 12% for the IRR, I still think thats the > right answer. Wow, I don’t remember that true/false question at all. That is so strange.

#20

+1… 5/6 on AI… missed the gross IRr, put 4… but i will take it… ahhh my passing subject… next yr when i take level 2 i guess i wont have to study AI since i am now an expert…