Thu, Oct 30, 2014
A A A
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: www.preqin.com

- 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. Manager Profile - Seth Klarman: Lessons for retail and institutional investors[more]

    From Valuewalk.com: Seth Klarman is virtually unknown outside value circles, despite his impressive record and value of assets under management. On average Baupost has returned 19% p.a. despite holding a large portion of its assets in cash. During the financial crisis, Seth Klarman’s funds lost some

  2. North America - FATCA leads 75% of U.S. expats to consider dropping citizenship[more]

    From International-adviser.com: Nearly three quarters of American expats are considering the renouncement of their citizenship following July’s introduction of the “absurd” Foreign Account Tax Compliance Act (FATCA). The findings, which were revealed in a survey by deVere, come alongside the news th

  3. Goldman in talks to acquire IndexIQ[more]

    From Bloomberg.com: Can Goldman Sachs put ETF investors on a liquid diet? Goldman is in talks to acquire IndexIQ, Reuters has reported. Index IQ is a small exchange-traded-fund firm known mostly for products that replicate hedge fund strategies, called "liquid alternative" ETFs. While IndexIQ has 11

  4. Other Voices: CALPERS dilemma should be a warning to hedge funds wanting institutional investors[more]

    From Ian Hamilton, founder of IDS Group. A quick comment on the CALPERS’ disinvestment from the hedge fund market and the jitters it is causing. Pension Funds should not be sheep and follow CALPERS’ decision as the issues that CALPERS has with hedge fund investments are in many ways unique t

  5. Hedge funds fell 1.18% in September on Fed tightening and ECB loosening[more]

    Komfie Manalo, Opalesque Asia: Hedge funds fell 1.18% in September on Fed tightening and loosening of the European Central Bank’s policy on equity markets, according to the Barclay Hedge Fund Index co