A phenomenon where an where an initial loss is followed by a significant gain. Typically shown as a line graph which illustrates how capital flows into a fund manager in the early years of a fund, in order to be used to make investments; and how the capital then produces gains towards the latter years in the fund’s lifecycle. Plotted over time, the J-curve shows the historical tendency of private equity funds to deliver negative returns in early years as money is invested, and investment gains in the outlying years as the portfolios of companies mature.