Top private equity funds separate from the pack

Top-quartile private equity funds broadened the performance gap between themselves and bottom-quartile funds. For funds with a 2016 vintage year, the average internal rate of return for the top-quartile funds was 25.9%, 19.3 percentage points above the bottom quartile. Additionally, the top-tier funds outperformed the median fund IRR by 11.5 percentage points, the highest for the 17-vintage-year history Preqin reported.

Compared with other asset classes, manager selection has always been a significant factor in performance with top-performing mangers more likely to remain among the best. Preqin did not report which funds were among the top performers.

Funds less than 2 years old are typically not considered mature enough to report meaningful performance data.