Opalesque Industry Update - In the endeavour to make the Hedge Fund Industry more transparent and accessible, Hedgeanalytics Ltd. and the ZHAW have developed the Total Risk Rating. This is the first public rating for fund of hedge funds which allows an on-going assessment of the overall risk of a fund. The first official Total Risk Rating has been completed in January 2012 on Basel Asset Managements’ funds and is now available on the website of Hedgegate.|
Hedgeanalytics Ltd. is a spin-off of the ZHAW – School of Management and Law in Winterthur, Switzerland, that runs the FoHF platform Hedgegate and provide valuable information to the public.
The Total Risk Rating has been developed by the ZHAW and Hedgeanalytics Ltd, with the aim to provide a detailed and comprehensive analysis of the risks of a fund of hedge funds. This solid and in-depth due diligence has been applied explicitly to the specific risk characteristics of fund of hedge funds. It is based on frontier scientific evidence and is designed the way that the possible influence of the analyst on the results is minimal. Thus, the process that leads to a specific rating is replicable and improves the comparability. The results are published on www.hedgegate.com.
The Total Risk Rating is based on the three categories: operational risk, liquidity & credit risk and market risk. The emphasis lies on the operational risk part. Each category is evaluated separately and then aggregated into a single rating (“A” to “E”). “A” represents the best, “E” the worst possible outcome. The rating letter together with a summary report on the key findings is made available to the public on www.hedgegate.com. A detailed report can be obtained from Basel Asset Management.
The first Total Risk Rating for three funds of Basel Asset Management has been accomplished in January 2012. All funds obtained a best possible A-rating. According to our methodology these results can be interpreted as “excellent” and are associated with very low risk. Particularly emphasised must be the high level of operational quality of the funds and the management which did not show any substantial shortcomings.
Basel Asset Management (BAM) was founded in 2004 by Roland Eberhard and has offices in New York and Pfäffikon SZ. BAM has a long-term strategic partnership for fund research- and management with ALPS Advisory Ltd. in Hong Kong. The group oversees over USD$1.2bn of assets in North America, Europe and Asia.
Here is a recent interview of Zhaw's Dr. Meier on Opalesque: