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Private Investments (PRE-IPO) in your Funds? OK?

ProtonAnalyst33
edited March 2021 in Fund Discussions
I know a number of funds out there have long been investing in late stage, private, pre-ipo companies for awhile now - T. Rowe's Ellenbogen comes to mind. Do any of you have concerns with this?

One one hand, it makes sense given how late companies have been waiting to IPO (though that seems to have changed in the last two years, especially with this SPAC party). Mutual funds used to particpiate much earlier in a companies stage of development since they IPOd early, thus we as public investors could be a part of a majority of the growth story (think Apple, Microsoft, etc). But again, that's not the case with many firms like Uber, etc.

On the other hand, Woodford across the pond obvoiusly went too far with his fund and blew it up.

Comments

  • MarkMark
    I’m of the opinion that these ‘private’ investments have been going on for a longer time than we think. If anyone really scrounges through their funds holdings there’s often many questionable listings, ‘others’ if you will, that take a lot of effort to sort out. As long as the percentages are minor I tend not to get too excited.
  • Observant1
    edited March 2021
    When I trust and respect a fund's managers/analysts, I don't fret if the fund has a minor allocation to private investments.
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