Assessed Project
Submit online via QMplus before 23:59 London Time on Friday 28th April 2023
ECOM209 R for Finance
This project carries a maximum of 100 marks. A 50% weighting will be applied to your overall
ECOM209 module score for completion.
You are required to submit a typed document in Word or PDF format containing written analysis
together with any supporting tables, graphics and R code you think is necessary.
The work required is detailed on the next page. Your code and analyses are required in R.
This project has an maximum word count of 2500 words excluding R output and any code that
you submit.
This project must be your own work presented in your own words.
Examiner: Dr R.A. Saldanha
? Queen Mary University of London, 2023
Page 2 Project Coursework: Semester B ECOM209 (2023)
Private Equity Performance Measurement
Internal Rate of Return (IRR) and Multiple on Invested Capital (MOIC) are two well known
performance metrics commonly used by private equity firms. Explain what these metrics are, how
they are used and how to compute them. In addition, discuss their respective advantages and
disadvantages.
Create a suite of R functions that can be used to analyse private equity data. In particular, you
should include functions to compute IRR and MOIC as well as supporting functions for producing
graphs and data summaries. You may find that the synthetic data on European Energy deals from
Lecture 2 provides a useful example dataset for your code development.
Consider other metrics that might be useful in assessing the merit of a private equity deal.
Consider their relative strengths and weaknesses in comparison with IRR. If appropriate, code and
apply these metrics in R also.
Feel free to present data on any interesting private equity projects you have found during the
course of your research. These data may be real or synthetic taken from papers or other sources
but be careful not to present anything that is in any way confidential or proprietary.
Provide suitable summary conclusions on your project as a whole. You may find the paper by
Magni & Marchioni (2020) and the references therein useful for your project generally.
Reference
Magni, C.A. and Marchioni, A. (2020) Average rates of return, working capital, and
NPV-consistency in project appraisal: A sensitivity analysis approach. International Journal of
Production Economics 29. https://doi.org/10.1016/j.ijpe.2020.107769.