Wed, May 25, 2016
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

White paper finds endowments' allocation to hedge funds relatively stable but role has changed

Monday, March 10, 2014
Opalesque Industry Update - In its just-released white paper, "Endowment Interest and Allocation to Hedge Funds/Funds of Funds," Infovest21 examines endowments' use of hedge funds from both a qualitative and quantitative viewpoint.

The white paper explores endowment chief investment officers' and consultants' views on the role of hedge funds in the portfolio, hedge fund performance, strategy preference, types of managers preferred, changes in endowment asset allocation, fees, risk and risk management, and the OCIO trend.

Lois Peltz, president of Infovest21 and author of the report, said: "The percentage endowments allocate to hedge funds hasn't changed much but their role in the portfolio has matured since 2008. Hedge funds are being used in the endowment portfolio for different purposes."

While consultants may place hedge funds in different buckets e.g. return enhancement, growth or risk reducing, many endowments and consultants perceive hedge funds as risk reducers.

Other highlights of the report include:

- Hedge funds are increasingly viewed as a vehicle rather than an asset class.

- Endowments' allocation to hedge funds has remained relatively stable. Many endowment CIOs are not currently looking to increase allocations due in large part to uncertainty over hedge fund performance and strong equity markets.

- Consultants see a shift away from multi-strategy funds of funds. Global macro and long/short equity are strategies cited most often. There has also been recent interest in fixed income substitutes given concerns about fears about rising interest rates.

- More endowments are considering the outsourced chief investment officer model for some version of investment management, not necessarily the entire operation. The OCIO model is a way for some endowments to solve a resource problem.

Press release

Infovest21, founded in 2000, is an information provider to hedge fund investors, managers, funds of funds and service providers. Led by Lois Peltz, president, the firm provides news, research, surveys, white papers as well as organizes seminars and conferences. The firm's focus is on hedge funds, funds of funds and '40 Act funds.

infovest21.com

Bg

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. Paul Tudor’s hedge fund trims fee amidst poor performance, keep investors[more]

    Komfie Manalo, Opalesque Asia: Paul Tudor’s $11.6bn hedge fund firm Tudor Investment Corp. announced on Monday it would slash down fees of one of its biggest fund to 2.25% of assets and 25% of profits amidst backlash arising from poor performa

  2. West Virginia objects to Alpha Natural sale to hedge fund[more]

    From AP/Heraldcourier.com: West Virginia's environmental authority has filed an objection to the proposed $500 million sale of Alpha Natural Resources' assets to a hedge fund, arguing that the deal could leave the state holding hundreds of millions in reclamation liabilities. The Register-Hera

  3. Mitch Petrick leaves Carlyle as his hedge fund unit suffers losses while assets expand[more]

    Komfie Manalo, Opalesque Asia: Mitch Petrick will be leaving Carlyle Group as head of its hedge funds unit overseeing about $34bn as of March 31, after several funds under his management suffered losses while assets expanded, various media reported. Petrick joined Carlyle in 2010 and was a former

  4. Institutions - Kentucky pension leans into hedge funds amid governance turmoil, Korea's NPS names finalists for initial $1 billion hedge fund-of-funds allocation[more]

    Kentucky pension leans into hedge funds amid governance turmoil From AI-CIO.com: The Kentucky Retirement Systems moved to increase its hedge fund allocation as controversy reigned over fund leadership. Following a string of high-profile hedge fund exits, the Kentucky Retirement Systems (

  5. Fund Profile - The hedge fund that couldn't stay open long enough for a big payday[more]

    From Bloomberg.com: Toby Dodson waited six months for his bet against a fragile Portuguese bank to pay off. But before the reckoning, word came down from his hedge fund bosses at Achievement Asset Management in Chicago: get ready to clear out your desk and unwind your trades, we’re shutting down. Th