I said two weeks ago I was thinking about buying shares in another undervalued private equity investment company. In the end, I opted for HarbourVest Global Private Equity (HVPE). The reason was pretty straightforward – I think it is on far too wide a discount.
Since the company’s shares first listed in London in 2010, the narrowest the discount reached was about 9.5% in January 2020, although the valuation gap soon ballooned to over 51% thanks to the Covid panic.
The shares subsequently recovered to trade around 25% below net asset value (NAV) for a couple of years – but the discount widened again over 2022 as interest rates rose and hit its widest-ever level of 52% in March last year.