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Investment Period

Private Equity glossary · Private Equity Fundamentals

Definition

See Commitment Period.

Investment Period in plain English

This is just another name for the Commitment Period — the early stretch of a fund's life (usually the first 4-6 years) when the managers are allowed to go out and buy new companies with the investors' money. After it ends, they can't make brand-new investments; they spend the rest of the fund's life growing and eventually selling what they already own. It's like the shopping window at a store's opening sale: once it closes, you can only manage the cart you've already filled.

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