The Compound and Friends · Monday, September 28, 2026
Erik Hirsch addressed the misconception that private markets are not correlated to public markets. He explained that the perceived lack of correlation is primarily due to the reporting time lag, where statements are issued a quarter after the period ends. When this lag is accounted for, the two are indeed correlated.
“It should drive you nuts because it's not true. It's totally correlated to the private markets. The reason why it can look less correlated or is even sometimes uncorrelated is the reporting time lag, which is also another frustration about our industry, which is, if you're in a private markets fund, and you're a limited partner in that fund, you're getting your statements at least a quarter lag after the prior quarter end.”
“But when you kind of erase that, and mathematically you can, they're correlated. They're equity markets.”