hard · Private Equity pe-core

If the sum of discounted distributions is $250M and the sum of discounted contributions is $200M (using a public index as the discount factor), what does the resulting 1.25 ratio imply?

1. The fund outperformed the public market by 25% on a cash-flow-matched basis.
2. The public market index outperformed the fund's returns by roughly 25%.
3. The fund simply returned 1.25 times the original capital contributed by its LPs overall.
4. The fund generated a net internal rate of return of roughly 25% on an annualized basis.

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