Fri, Nov 27, 2015
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Preqin survey - Institutional investors favor direct investments over FoHFs

Thursday, July 15, 2010
Opalesque Industry Updates - A Preqin survey of 50 institutional investors in hedge funds reveals that investors are re-evaluating their fund of hedge funds investment strategies and seeking to commit to single manager funds. 64% of respondents made their first hedge fund investment through a fund of hedge funds, but just 36% of these investors continue to pursue investments in such funds.

Investors surveyed included public and private sector pension funds, asset managers, insurance companies, banks, foundations, family offices and endowments. Respondents were from all regions. They were asked about their current hedge fund portfolios, investment strategies and interest in both funds of funds and direct investment in hedge funds.

Key Findings include:

  • 80% of respondents that have moved away from funds of hedge funds did so in 2008 or after.
  • 64% of respondents entered the asset class through fund of funds investments, but only 36% of these continue to invest solely through funds of hedge funds.
  • 36% of respondents that currently invest solely in funds of hedge funds plan to move towards direct hedge funds in the future.
  • 60% of respondents cited the extra layer of fees as the main reason they moved away from funds of hedge funds.
  • Greater control over their investments (54%) and more in-house resources (13%) were other reasons cited for the move into direct investment.
  • Public pension funds still invest heavily in funds of funds, with two thirds of public pension funds only investing through funds of hedge funds.
  • Endowments and insurance companies are the largest investors in direct funds, with 66% and 50% respectively only investing in hedge funds directly.

Corporate website:

- FG

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
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. Other Voices: Hedge fund marketing and the selling cycle[more]

    By Bruce Frumerman. How long is the selling cycle now? That’s a question my financial communications and sales marketing consulting firm has been asked on a regular basis by hedge fund firm owners and sales people, ever since we opened the doors to our firm in 1987 pre-crash. Wa

  2. People - Solus Alternative Asset Management adds chief strategist from BTIG[more]

    From Daniel Greenhaus joined hedge fund manager Solus Alternative Asset Management as managing director and chief strategist. He will work closely with Chris Bondy, Solus’ chief economist, managing director and executive vice president, said Chris Pucillo, CEO and chief investmen

  3. Opalesque Roundtable: Seeding deal terms can be onerous for hedge funds[more]

    Benedicte Gravrand, Opalesque Geneva for New Managers: Executives from fund of funds firms, family offices, a placement agent, a private equity firm, and an accounting firm gathered in Connecticut last month for the

  4. Opalesque Roundtable: Family offices flock to co-investment[more]

    Bailey McCann, Opalesque New York: Co-investments have been a hot topic for pension funds in recent years, as they try to move away from high fees and improve transparency. But now, family offices are more readily getting into the mix and establishing in-house deal teams, according to the delega

  5. More institutional investors invest in CTAs compared to last year despite dissatisfaction with performance[more]

    Benedicte Gravrand, Opalesque Geneva: "Despite a strong start to 2015 for CTAs in Q1, commodity market conditions have made return generation difficult for fund managers over much of the rest of the year to date," says Preqin’s November