Fri, Aug 26, 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. Opalesque Exclusive: Algorithms platform aims to target typical challenges found in quantitative hedge funds[more]

    Benedicte Gravrand, Opalesque Geneva: Last month, Quantopian received investments from Point72 Ventures, the new venture capital arm of Steven Cohen’s Point72 Asset Management.

  2. LatAm hedge funds surge in 1H to +24.4%, emerging markets assets rise[more]

    Komfie Manalo, Opalesque Asia: Hedge funds investing in Latin America posted strong gains through mid-2016, reversing declines in four of the past five years, including the last three years, to lead all areas of hedge fund performance through the first half of 2016, according to the latest HFR Em

  3. Asia - LGT Capital Partners: Alternatives set for continued rise in Asia[more]

    From Asianinvestor.net: More flows are likely into insurance-linked strategies, private equity and trend-following strategies/CTAs, given the benefits of such investments, argues LGT Capital Partners. Despite the numerous quantitative easing programs and bailouts of recent years, the quest for

  4. Opalesque Roundtable: Low and high fee investments often better than mid fee hedge funds[more]

    Komfie Manalo, Opalesque Asia: Hedge funds that charge the low and high fees stuff often provide better returns than "those sort of mid-fee investments", said Keith Haydon, chief investment officer of Man FRM. (Alternative) investment managers who charge high fees would often provide the most int

  5. Hedge fund investors pull $5.7 billion in July[more]

    From Bloomberg.com: Hedge funds suffered a third consecutive month of outflows in July as investors withdrew $5.7 billion, according to industry tracker Eurekahedge. Redemptions totaled $20.7 billion in the three months through July, with money managers betting on equities suffering $18.4 bill