What’s Going On Here? Private equity firms have had their busiest-ever start to a year, inking more than $500 billion in deals around the world across the first half of 2021.

Ultra-low interest rates have made private equity’s promise of solid returns more popular than ever – helping firms amass a mountain of investor cash. And since private equity deals almost always involve huge chunks of debt, low rates have also created the perfect environment for them to get busy buying.

What is private equity? Traditional stock investments are in “public” companies: those listed on the stock market. But there’s a whole world out there of non-listed companies: firms that are either too small to have ownership openly traded, or that prefer to operate out of the public spotlight. And some of them are ripe with investment opportunity.

That’s where private equity firms come in. They invest in, well, private equity (another term for shares in a company). That can take the form of “venture capital”, where small investments are made in startups or other fast-growing companies, and there are other strategies too. But a lot of the time when you hear people talk about private equity (or PE for short), they’re referring to investors buying out a whole company. Their aim is to then transform the business, make it more valuable – and eventually sell it on for a profit.

Private equity firms are rushing to buy up companies – but several are simultaneously looking to list themselves on stock markets. California’s TPG Capital and Britain’s Bridgepoint Advisers are both considering selling stakes in initial public offerings (IPOs), apparently drawn by the historically high valuations investors are currently willing to pay for stocks.

While investing directly in private equity funds remains restricted to the very wealthy, shares of dozens of firms are now publicly available. Some have proved hot tickets: Sweden’s EQT has risen 270% since listing in 2019.