Thu, Jan 18, 2018
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

Other Voices: Chasing shadows: should hedge funds shadow administrators?

Wednesday, March 27, 2013

This article was provided by Bijesh Amin, Co-Founder/Managing Director at Indus Valley Partners.

To shadow or not to shadow

At least that is the question facing many large hedge funds with assets well above the magical $1bn mark.

The production of a portfolio NAV (Net Asset Value) is the basis upon which investors pay fund managers their performance fees on the one hand and often the basis upon which they give capital to funds on the other. The majority of hedge funds use a Fund Administrator (e.g. Citco, GlobeOp, BNY Mellon etc.) to calculate their NAV and in some cases perform a range of portfolio accounting functions, reconcile their trades, and prepare investor reports.

Investors will often insist on the use of a fund administrator given they can be seen as an impartial 3rd party to value portfolios, and in light of well-documented be a sensible requirement.

However the handing over of such a key metric such as NAV is causing sleepless nights for many funds, particularly those trading illiquid assets (which can be price that can be seen from a Bloomberg terminal or Level 3 assets in valuation parlance). Portfolio managers may be loathe to hand over the basis on which their performance fees are calculated to people who do not trade the asset classes for a living and have probably never been practically or academically trained in the valuation of those assets.

So naturally the question arises that even if an administrator is being used, should a ......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Legal - Former Och Ziff hedge fund executive indicted for fraud in Africa investment scheme, prosecutor says, Hedge fund blasts defense of Puerto Rico restructuring law[more]

    Former Och Ziff hedge fund executive indicted for fraud in Africa investment scheme, prosecutor says From CNBC.com: A former hedge fund executive faces federal charges for defrauding a UK-based charity over investments in Africa, according to a grand jury indictment made public Wednesday.

  2. U.S. economy, inflation and alternative investments to dominate 2018 markets, says family office Wilmington Trust[more]

    Komfie Manalo, Opalesque Asia: The emergence of a late-cycle economy in the U.S., the mystery of inflation and growth from a domestic and global perspective, and the potential for alternative investments to prosper against a backdrop of rich valuations, low yields, and higher volatility are the t

  3. Performance - Some hedge funds deliver double-digit gains for 2017, Brevan Howard's hedge fund suffers biggest annual loss in 2017, Crispin Odey's flagship hedge fund plummeted about 20% in 2017, Profits fall 90% at ex-Morgan Stanley banker's hedge fund, Fannie-Freddie overhaul might mint hedge fund riches, losses[more]

    Some hedge funds deliver double-digit gains for 2017 From Reuters/Investing.com: A handful of hedge funds ended 2017 with double digit returns, their investors said, at a time the $3 trillion industry took in fresh money and posted its best returns in years, industry data show. Act

  4. Investing - Hedge funds start 2018 with record $19 billion bet on the euro, Hedge fund Kora Management invests in Satin Creditcare[more]

    Hedge funds start 2018 with record $19 billion bet on the euro From Reuters.com: Hedge funds have kicked off 2018 with their biggest bet ever on the euro rising, a clear vote of confidence in the single currency but, with positioning so stretched, one which could backfire in the near ter

  5. News Briefs - Mobius to retire from Franklin Templeton, Authorities decrypt smart phone of Princeton grad charged with killing Manhattan hedge fund dad, Investigators seize (more) antiques from hedge-fund billionaire Michael Steinhardt's collection[more]

    Mobius to retire from Franklin Templeton Emerging markets pioneer Mark Mobius will be stepping down as executive chairman of the Templeton Emerging Markets Group (TEMG) and formally retire from Franklin Templeton on 31 January. He will also be relinquishing his post as portfolio manager