Altera Investment Institute | Feb 1, 2019Download PDF
Lower-middle market private equity was once viewed as a trade-off between value and risk, only appropriate for the barbell of unsophisticated investors on one end and institutional investors on the other. Yet today, it’s something investors can no longer afford to ignore. What has changed? More granular data, more sophisticated analysis of the characteristics can be tied to a fund’s potential to succeed.
Altera has become a new leader in understanding this part of the private equity market and has carved out a prized market position that directly benefits individual investors and institutions alike.
In this overview, we discuss the themes driving transformation in lower- and lower-middle market investing. The aim for including the Lower Market is to create more diversified portfolios and strategies that do not compromise financial returns; using innovative research to go beyond headline perceptions and understanding; capitalizing on sub-institutional pricing to capture “size arbitrage”, and the integration of niche and tactical allocations into traditional investment strategies to produce a win-win as we accelerate towards a more alternatives leaning global opportunity set.
Our work fuels our conviction that the future of investing is one with the lower market comprising a much larger portion of the pie.