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Luis O’Shea

Luis O’Shea

Executive Director, MSCI Research

As head of Private Capital Solutions (PCS) Research at MSCI, Luis O’Shea oversees all of PCS’s research engagements with clients, the writing of research papers, and the research and design of analytical models on the PCS platform. Before joining Burgiss, which MSCI acquired in 2023, he held a series of research roles at BlackRock, Axioma, RiskMetrics and McKinsey & Company. Luis holds an undergraduate degree in mathematics and physics from University College Dublin and a doctorate in mathematics from Cornell University.

Research and Insights

Articles by Luis O’Shea

    Investment Trends in Focus: Quarterly Roundtable Q2 2024

    Podcast | Apr 25, 2024 | Luis O’Shea, Laura Nishikawa, Anil Rao, Ashley Lester

    Our panel discusses what’s happening in public equity markets, the importance of governance and of sustainable investing more broadly, as well as the growing world of private assets, including private credit and the ways in which these assets might come to resemble their public counterparts more than they do today.

    Inflating Returns with Subscription Lines of Credit

    5 mins read Blog | Jan 9, 2024 | Patrick Warren, Luis O’Shea

    The increased use of subscription lines of credit by general partners in some private-capital funds has lifted returns by squeezing the timeframe over which returns are calculated. We examine buyout, private-credit and real-estate funds to see where the greatest inflation lay.  

    Foul Is Fair, Fair Is Fair: Is Private Equity Rich?

    8 mins read Blog | Jun 21, 2023 | Luis O’Shea

    Our analysis using the Burgiss Manager Universe, combined with novel analytics, suggests that venture-capital funds at the end of 2022 were close to fairly valued, and buyout-fund valuations appeared to be in line in with historical norms.  

    Diversifying Away Cash Drag

    5 mins read Blog | Mar 29, 2023 | Patrick Warren, Luis O’Shea

    Constructing self-financing private-capital portfolios, where distributions exceed contributions, can simplify a limited partner’s liquidity-management strategy and reduce cash drag. How could diversification help investors in this effort? 

    Where Have All the Cash Flows Gone?

    6 mins read Blog | Oct 11, 2022 | Patrick Warren, Luis O’Shea

    An assessment of private-market cash flows as of June 2022 indicates mixed signals for limited partners. The prudence of maintaining a diversified portfolio is as important as ever.

    The Truth Will Out: Is Private Equity Overvalued?

    6 mins read Blog | Sep 15, 2022 | Luis O’Shea

    Are valuations of venture-capital and buyout funds on point? Our analysis exploits the fact that fund valuations are subjective, but fund cash flows are objective, that is, distributions reveal the true value of assets, and the truth will out. 

    How Risky Are Private Assets?

    Research Report | Jan 1, 2022 | Patrick Warren, Luis O’Shea

    Estimating risk in private markets presents a perennial challenge for reasons such as the low frequency of operations and irregular cash flows. We discuss the importance of risk-adjusted returns for asset allocation and present a way to gauge volatility across asset classes. 

    Open- vs. Closed-End Real Estate Funds: How the Choice Mattered

    8 mins read Blog | Mar 30, 2021 | Luis O’Shea, Bryan Reid, Bert Teuben

    The aggregate performance of closed- and open-end real estate funds in the U.S. was strikingly similar in recent years, despite large differences in their strategy and roles in portfolios. But did some investors gain an edge through fund selection?

    How to Benchmark Private Capital

    Research Report | May 1, 2019 | Luis O’Shea

    We discuss the importance of constructing a benchmark for private-capital portfolios that is both accurate and informative. We address the characteristics that such a benchmark should have and recommend a pooling methodology to avoid the danger of misleading performance data. 

    Single-Period Performance Attribution for Private Capital

    Research Report | Dec 1, 2018 | Luis O’Shea

    In this paper, we develop a methodology for single-period Brinson-style attribution of private-capital returns. We apply the methodology in two case studies — each addressing buyout, venture-capital, and real-estate funds — to demonstrate insights on the sources of returns. 

    Commitment Pacing for Targeting a Fixed Valuation

    Research Report | Sep 1, 2018 | Luis O’Shea

    We study a deceptively simple question in private assets: At what rate should one commit capital to best achieve a specific valuation target? We formulate several algorithms that dictate the pace of commitments and quantify their performance.

    Budgeting for Capital Calls Using a VaR-Inspired Approach

    Research Report | Mar 1, 2018 | Luis O’Shea

    Limited partners in private-capital funds must gauge how much capital to keep in reserve to meet capital calls. In this paper, we discuss this investor challenge and introduce a new concept called maximum probable contribution (MPC), which overcomes two key limitations of traditional models.