IRR: The Most Dangerous Ratio in Investing

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In this video, George Aliferis, a reformed banker, uncovers the truth behind the global pitch pushing private investors towards illiquid assets and the misleading nature of IRR (Internal rate of return) in private equity. He declares the IRR is an Inappropriate Return Ratio and reveals how to navigate wisely through private equity marketing pitches.

RELATED CONTENT

TO GO FURTHER

KEY FINANCIAL CONCEPTS IN THIS VIDEO
Private Equity
IRR
MOIC
DPI
TPVI
CAGR
Rate of Return

FIRMS & PEOPLE
KKR
Blackstone
Appolo Global
Tony Robbins and his new book: The Holy Grail of Investing

TIMESTAMPS
00:00 The Illiquid Assets Pitch: Unveiling the Truth
00:59 Private Equity's High 'Returns'
01:41 Access to Private Equity: A Changing Landscape
02:09 Comparing Returns: Private Equity vs. S&P 500
03:54 The Misleading Nature of IRR in Private Equity
04:58 Unpacking the IRR: Real Returns vs. Marketing Hype
08:02 Actual PE sales call
09:59 Navigating Private Equity Investments Wisely
10:33 Further Resources and Closing Thoughts

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If you enjoyed this video - please share it! So many people are confused and will be fooled by the IRR!

InvestOrama
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As a fan of Limitless, I stumbled onto your channel. I have been looking for this kind of information. I'm hooked and I am about to subscribe. Thanks.

williamj.dovejr.
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Does Cambridge Private Equity Index shows really IRR? If this is true it shouldn‘t be allowed to compare it with public Equity Indices. Kind regards

B.L-nf
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Hi, I just wanted to say that I love your work, even though I don't (want to) understand it. Me, I'm a trader on short timeframes, so my Edge lies elsewhere, but I always watch your content. Actually, since I watch almost no videos about investing, per se, especially ratios and the like, I appreciate the few I watch all the more. The value here is the institutional angle, not the retail, since I need to understand how firms think to trade with, or against, them ... much like market makers. Cheers.

LeadingIndicator
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What ratio do you recommend we should look at? what do you recommend?

adanramirez
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Thanks man, i have a question how to tackle such sales persons: "what should be my counter?"

shubhomar