The CA benchmarks are composed of institutional-quality private investment funds, defined as closed-end, commingled funds that invest third party capital with all investment decisions made at the discretion of the fund manager. These vehicles are investible opportunities for sophisticated investors such as endowments, pensions, foundations and other organizations. The funds are of a sufficient size relative to their asset class/geographic investment strategy to permit the entry of large investors. The benchmarks exclude open-ended or evergreen funds, corporate funds that invest off a company’s balance sheet, and funds with only a single institutional limited partner.
FREQUENTLY ASKED QUESTIONS
CA sources the data for the benchmarks from the quarterly unaudited and annual audited financial statements that private investment fund managers produce for their fund investors. Unlike other data providers, CA does not use any FOIA requests, regulatory filings, manager surveys, or press “scrapings” to obtain information.
CA’s benchmark database uses the quarterly unaudited and annual audited fund financial statements produced by the fund managers for their fund investors. Quarterly cash flow and quarter-ending Net Asset Value (NAV) data are extracted from the financial statements.
CA’s proprietary data input tool conducts several automated tests on fund, client, and portfolio company-level data to ensure completeness and accuracy prior to inclusion in the database. Once a fund has been updated with new data (whether a quarterly update for an existing benchmark fund or a historical set of performance data for a fund being added to the database) it is subjected to an extensive quality control process with both automated and manual review within 48 hours. Once all funds for a given asset class have been updated and run through the required quality control procedure for a quarter, the Benchmarks Team conducts a quality check on the asset class before the final benchmark statistics are reported.
In addition to performance information, Cambridge Associates is constantly reviewing the classification information on managers in the database to ensure accuracy. For example, Cambridge Associates’ Private Investments Manager Research group conducts over 2,000 meetings and calls with fund managers annually, and regularly reviews our database information to ensure that a manager’s classifications in terms of fund strategy, geographic and sector focus are up-to-date.
The CA benchmarks are reported on a one-quarter lag, due to the reporting time frame of private investments fund managers. Since CA does not use FOIA requests and other public sources of data, our benchmarks do not suffer from the FOIA time lag that can sometimes lead to months of additional delay in reporting performance.
To protect the confidentiality of individual funds and their underlying portfolio investments, the published benchmark statistics reports contain only aggregate information. Vintage year returns and aggregate portfolio returns by industry are only reported once the sample size is sufficiently robust to allow for reporting that does not compromise confidentiality.
In addition, CA has decades of experience handling sensitive fund manager data that have been submitted by over 1,800 fund managers for the various CA benchmarks. Our franchise in the investment management industry has been built on the premise of strict confidentiality. Our reputation and long-standing relationships in the industry speak to our prudence and discretion as custodians of manager data.
Cambridge Associates does not pay managers for the data included in the benchmarks, nor does CA accept fees from managers to participate in the benchmarks. Managers that participate in the benchmarks receive complimentary copies of benchmark statistics reports.