Private equity is going into mass production, with the debut PowerShares’ new exchange traded fund that will focus on companies (read: private equity firms) that invest in other companies. The new PowersShares Listed Private Equity Portfolio, which will makes it debut Oct. 24 on the American Stock Exchange, will be based on an index composed by Golden, Colo.-based Red Rocks Capital, and, according to PE Week Wire, will invest in 34 companies including Apollo Investments, American Capital Strategies and Macquarie Infrastructure, among others. Daniel Primack of PE Week Wire, says Red Rocks think the p.e. ETF will do for private equity what real estate investment trusts did for the real estate securities market. The new offering is aimed not at retail investors, but mainly defined contribution plans. Primack predicts, however, that the ETF will attract individuals as well as they respond to the current p.e. hype. That hype, says Primack, may have small-fry investors dreaming of big returns a la The Blackstone Group, when in reality performance for the ETF would be somewhat less but the investment still be “a useful tool for diversification.” Meanwhile, speaking of mass appeal, U.K. “superwoman” Nicola Horlick’s Bramdean Asset Management reportedly is planning to launch and list Alternative Investment Fund next year, a hedge fund aimed at the “mass affluent.”
