Realizations

Money returned to investors when a manager sells or exits an underlying investment. Realizations are the point of the business -- they crystallize performance fees and prove returns are real rather than marked -- and they simultaneously REDUCE assets under management, because the capital goes back to the investor. That double effect is what makes the metric awkward: a quarter of heavy realizations can show excellent earnings and shrinking AUM at the same time, and both are correct. Read realizations as the conversion of paper marks into cash, not as a growth number.

Related terms

Absorption Rate · AFFO per Share · Allowed Return on Equity · Alternative Investments · Anchor Tenant · Ancillary Spend per Visit

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