Mon, Sep 22, 2014
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Opalesque UCITS intelligence

Editorial

Wednesday, July 24, 2013

Sophie

In its latest report, the hedge fund research firm PREQIN had some interesting research on Alternative UCITS (the report is freely available). Highlights included:

  • 86% of investors in UCITS hedge funds are based in Europe
  • Long/Short equity has been the most commonly sought UCITS by investors in the last 12 months
  • Half of the UCITS hedge fund pursues a Long/Short strategy
  • 12% of UCITS funds are managed by US based fund managers
  • UCITS hedge funds returned 2.46% in Q1 2013 compared to 3.22% for hedge funds

First, I would like to outline the difficulty to analyze the funds and strategies universes which combine hedge fund managers and long only firms. Is the biggest fund under that category ( ie Standard Life Global Absolute Return Strategies Fund)– suitable under Alternative UCITS? With $25 billion under management is its weight appropriate ?

It makes sense to divide Alternative UCITS in two universes: Hedge funds and long only in order to identify the style of management and compare funds that are using similar investment guidelines.

Some allocators such as Daniel Capocci, CIO at Archidas selecting UCITS, explains that combining the brand of long only managers with specific Long/Short skills in hedge fund managers gives a good mix to investors, especially retail investors.

Yes indeed, Long/Short equity strategy is the strategy that probably fits the best under a UCITS format. We have addressed this issue in our interview with event driven managers.

Most asset allocators and investors recognize that the pool of talent is mainly European. See PSAM’s comment in this edition on their experience in bringing their US expertise under a UCITS format.

Finally, the levels of returns are still a critical aspect of UCITS funds at a time where retail and institutional investors are looking for yields! However, investors in general are aware that liquidity and regulation are limiting their investment processes and therefore their upside in performance. I remain extremely prudent on the level of communication to investors on strategies such as Risk Parity, especially when the performance volatility, ; as experienced in May and June, could have a negative impact on the UCITS brand.

When Matthias and I were at the GAIM Conference, we met several investors and asset allocators who were pleased to read more about the UCITS platforms and their models. Consequently, we have decided to provide even more insight on this specific universe and we will continue to follow in our coming editions.

We wish you a happy reading and are look forward to hearing your feedback !
Have a lovely summer !

Sophie
sophie@opalesque.com



 
This article was published in Opalesque UCITS intelligence.
Opalesque UCITS intelligence
Opalesque UCITS intelligence
Opalesque UCITS intelligence
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. SEC charges 19 investment firms and one trader for breach of Rule 105[more]

    Benedicte Gravrand, Opalesque Geneva: The Securities and Exchange Commission (SEC) started a push to enhance the enforcement of Rule 105 of Regulation M last year to uncover hedge funds and private equity firms that have illegally participated in an offering of a stock after short selling it duri

  2. Fund managers, bullish on Europe, anticipate monetary policy separation of Fed and ECB[more]

    Komfie Manalo, Opalesque Asia: At least 202 fund managers with $556bn of assets under management said that while the European Central Bank (ECB) has eased its monetary policy that sent sentiments towards Europe to pick up, the Fed is expected to hike its rate in the spring of 2015. Investor

  3. Institutions - North Carolina workers call on state pension to dump up to $6bn in hedge funds, UK pension fund criticizes hedge fund fees[more]

    North Carolina workers call on state pension to dump up to $6bn in hedge funds From Forbes.com: The State Employees Association of North Carolina this afternoon called on state Treasurer Janet Cowell to withdraw all investments in hedge funds, which appear to amount to approximately $6 b

  4. News Briefs - Limited partners of investment managers may be subject to self-employment taxes, Just one week left until NYC's Rocktoberfest[more]

    Limited partners of investment managers may be subject to self-employment taxes On September 5, 2014, the Internal Revenue Service (“IRS”) issued Chief Counsel Advice 201436049, concluding that members of an investment manager were subject to self-employment taxes with respect to their e

  5. Institutions - Adviser's faith in hedge funds unshaken by CalPERS' move Advisers weigh in on CalPERS’ decision, Gina Raimondo sees no reason to follow California’s lead, exit hedge funds, Danish pension funds step up 'alternative investments'[more]

    Adviser's faith in hedge funds unshaken by CalPERS' move From WSJ.com: Financial advisers who use hedge funds in their clients' portfolios say they aren't rethinking that approach after a huge California pension fund announced plans to exit the hedge-fund market. The decision by the Cali