Does Private Equity have a Role in Superannuation Portfolios?


This paper looks at whether private equity (PE) has a role to play in meeting retirement savings needs. In theory, the PE asset class seems well-suited to superannuation investment given its long-term profile and high returns targets, and can offer diversification to more liquid or volatile asset classes. This paper looks at the historical evolution of pension allocations to equity, and the empirical evidence on PE investments in pension funds. The Australian experience is discussed, particularly in the context of the challenges posed by this asset class in modern superannuation portfolios.

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This paper was presented in July 2013 at the 18th Melbourne Money and Finance Conference (MMFC), which explored the theme Financial Sector Evolution – Prospect and Determinants.

For more papers presented in the conference, please click here.