“You could look at any asset class at any point in time and position it in a way and understand why it’s outperformed or underperformed,” said Scott Stackman, managing director of private wealth at UBS Wealth Management. Here is Mr. Rasmussen’s argument for caution in three areas:A model past its primeDuring the financial crisis, Mr. Rasmussen worked at Bain Capital, a leading name in private equity. One of his jobs was to collect data on deals by Bain and its competitors to determine why some had done well and others had not. This was not solely for the obvious reason that paying less is better, but because private equity funds typically borrow 60 percent of the purchase price, which affects a company’s profitability. Mr. Rasmussen said he admired the success Bain had in the 1980s and ’90s, but began to question whether the private equity model it had helped pioneer was still sustainable.

Source: New York Times September 14, 2018 17:28 UTC