I'm trying to understand the concept of cash on cash return in investment properties. Specifically, I want to know what DPI, or dollars per inch, means in this context of cash on cash.
7 answers
Riccardo
Wed Oct 23 2024
DPI, or Distribution to Paid-In Capital Ratio, serves as a crucial metric in evaluating the performance of a private equity fund.
GeishaMelody
Wed Oct 23 2024
It measures the cumulative value of distributions made to investors in relation to the initial capital invested.
Nicola
Tue Oct 22 2024
Essentially, DPI provides a snapshot of the cash return on investment for the investors, expressed as a multiple of their paid-in capital.
Daniela
Tue Oct 22 2024
Additionally, it can be used to benchmark a fund's performance against industry peers and to assess the potential for future distributions.
alexander_rose_writer
Tue Oct 22 2024
A DPI greater than 1 indicates that investors have received more in distributions than they initially invested.