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Kenneth J. Heinz Bailey McCann, Opalesque New York:
$5bn is the magic number for hedge fund success when it comes to attracting capital, according to participants speaking on hedge fund allocations at the SALT Conference which started today in Las Vegas, Nevada. The SALT Conference is a global conference that attracts financial, business and policy leaders from around the world. During a panel that amassed several notable industry professionals.
Capital inflows continue to go to bigger brand name funds, despite data showing that emerging managers tend to outperform larger, more risk averse funds. "This type of allocation shows a lack of conviction among investors," said Kenneth J. Heinz, CFA
President of Hedge Fund Research, Inc. of the trend. He notes that investors are more focused on potential losses than potential returns in spite of some shorter term losses.
"In 2011, funds got as much attention for the trades they didn't make as for their returns," Heinz said. In this type of environment larger funds are pulling in capital as investors focus on risk almost more than return. More than half of the capital managed by funds is managed by funds with $5bn or greater in assets under management.
Much of this trend is driven by the influx of institutional investors in the hedge fund space. "Many investors are looking at the infrastructure of the underlying fund," said Ray Nolte, Managing Partner, SkyBridge Capital. Institutions are coming in...................... To view our full article Click here
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