you tell the PE firm that you will commit $5m to their fund.
Then as they find an investment, they “call down” 1m of your commitment. This is used to buy the investment, its capital called down.
“Tried to look it up in the Index but cudn’t find it. Thanks!” - Scared of CPK, who doesn’t?
It is like investing portion of committed capital when opportunity comes.
Suppose you have 200m in committed capital but you find an opportunity worth of only 100m. That 100m is called down
May I ask a question :
- carried interest. Is it applied to NAV-Commited capital or capital drawn ? I am getting conflicting stuff from schweser reading and practice exam.
txs.
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