A sponsor doubles its equity investment over a five year hold. Approximately what IRR does a 2.0x MOIC over five years imply?
- A. About 20 percent
- B. About 15 percentCorrect
- C. About 25 percent
- D. About 10 percent
Takeaway. 2x over five years compounds to about 15 percent a year, an anchor pair worth knowing by heart.
