VanEck has announced the launch of a new global listed private equity ETF that is expected to list on the ASX soon.
According to the firm, the VanEck Global Listed Private Equity ETF (GPEQ) is the first to give investors access to private equity investments via a single trade on the ASX.
VanEck CEO and MD of Asia-Pacific Arian Neiron described the ETF as the “only one of its kind in Australia” to offer exposure to an asset class that is usually illiquid and difficult to access.
“Private equity offers investors long-term historical outperformance over public markets, yet traditionally it has only been accessible by institutional and ultra-high-net-worth investors,” said Mr Neiron.
“As an alternative investment, private equity is important for investor’s portfolios as it displays a low correlation with equities and bonds as well as offering attractive risk and return characteristics.”
GPEQ will track the LPX50 Listed Private Equity Index, which is designed to represent the global performance of the 50 most highly capitalised and liquid listed private equity companies and is diversified across different regions and private equity investment styles.
The 10-year performance of the Australian dollar index was 20.9 per cent p.a. as of 31 October, according to VanEck.
Mr Neiron noted that only 2 per cent of companies are estimated to be publicly listed while 98 per cent remain private.
“The VanEck Global Listed Private Equity ETF will open up that significant market and enable investors to participate in private equity, which has gained in appeal during the current low interest-rate environment,” he said.
“GPEQ will also enable investors to participate in mega trends such as the huge explosion in technology companies developing breakthrough technologies.”
