When looking at the reasons for the rise in private equity investing, we cannot dismiss the role of fewer publicly traded stocks. Over the last 30 years, the number of listed companies has declined by 50%. Of course, the decline of public and rise of private equity is caused by some other factor. It could be the cost of regulatory requirements associated with being listed. It could be an advantage to work with a limited number of investors over a diverse set, regardless of the regulation. No matter the reasons, fewer companies are easily traded by investors on exchanges. The choices have fallen, and the diversification possibilities have declined.
No comments:
Post a Comment