Stonks is an Internet meme and humorous slang term for “stocks,” or shares of a company bought, sold, and traded as an investment. It is used in several ways: to make fun of financial incompetence or ignorance, in reference to viral meme stocks, or to characterize misguided efforts or comical mistakes.

I assume that the use of stonks by the FT refers to benchmarks that compare your stock’s performance to something ridiculous , like the performance of technology stocks stoked by AI et al.

So the article turns out. The problem is that all the action is in the public section as al the winners are now public. Which means that private equity appears to be “lagging”.

The FT article refers to how large American’s pension performance has been measured and how Private Equity (the red bar) has been shown to be the Stonks (or should I say Stahnks).

This is all a bit theoretical for UK investors and more particularly who get paid a pot (or in the future a pension) linked to their investments; but if you were a UK fund manager wishing to be judged on the value you gave for your money managed, would you invest out of choice in stocks that constitute the red bar?

I suspect that a lot of fund managers are deeply suspicious about what private equity will do for their career prospects!

The article enters into a discussion started by Ludovic Phalippou at Oxford  who has written about  this problem “before here, here and here”

I expect that Toby Nangle has had a say and I hope that this conversation can be translated into the speak that those of us who try to work out what “value for money ” is, can properly understand.

If there is no reason for the red bar being low, then many of us will question whether investing in expensive stocks that it is hard to sell and uneasy to value is a good idea for our humble pension pots.

I think of private stocks every time I eat a Mars Bar because I know Mars. It’s biggest factor is up the road in upper Slough and when I went when working on its pensions I was told that it kept ahead of its competitors because it wasn’t bound by being publicly quoted.

The lesson for me , from reading this article, is that I know no more about what the benchmark for my private equity holdings  should be (I have some in my Nest Pot) than I knew when I got befuddled by the strange photo and the use of “Stonks”.

There is a lot of talk in this article of “lags” but the lag that I’d like reversed is our knowledge of how our pensions are being valued and against what.

If we are to get to know the VFM  from our pension (pots) , we need transparency and “Stonky” benchmarks don’t seem to be helping!