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From Kirsten Bischoff, Opalesque New York:

Managed accounts received a boost in attention in late 2006, as Amaranth imploded and many thought that, had investors been given transparency through to monitor underlying positions they would have had early warning as to over-weighted areas of the fund investments.

A second boost for managed accounts came in late 2007 and 2008, with the double whammy of the discovery of the Madoff fraud and the lock up of assets across the hedge fund industry. Managed accounts seemed to be a full-proof way investors could monitor what managers were doing and maintain some control over their assets.

However, a year and a half after this second push for managed accounts, it has become clear that they are not a one size fits all solution, and in many cases strong due diligence procedures are a much better option for investors looking to protect assets.

“[Managed accounts require] a lot of operational work that most investors are not set up to do,” explained Hans Hufschmid, CEO of fund administrator GlobeOp Financial Services, speaking as part of a panel of alternative investment experts at the 2010 Milken Institute Global Conference held earlier this month.

Institutional investors still working to convert to managed accounts Large, institutional investors remain very serious about conv......................

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