Thu, Oct 2, 2014
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
New Managers September 2012

Seeders Corner - Investcorp: Institutions can invest in emerging managers through special programs

Investcorp: Institutions can invest in emerging managers through special programs

Deepak Gurnani

Since 2000, institutional money has been penetrating the hedge fund industry. But since 2088, when a lot of non-institutional money redeemed, most of the hedge fund industry's assets come from institutional sources. Deepak Gurnani, the head of the $5 billion hedge fund business at Investcorp, said during a recent Opalesque TV interview that this is a positive in that it forced the hedge fund industry to focus on risk management and transparency. There is one big concern however coming from this trend, he adds. And that is that most of the institutional money goes to the larger funds. Not that larger hedge funds are bad. But if so much money goes into them, this can lead to "dilution of returns." He authored a paper in 2010 that compared the performance of large funds ($5bn +) and that of new funds (3 years or younger), which are assumed to have less assets.

"We found that over the last seven years, which was the focus period for the study, the emerging funds outperformed the large funds on a risk-adjusted basis. "So, the next logical question was that surely the emerging funds take a lot more risk than large funds and as a result they have outperformed," he explained. "I think what was most interesting was that most of that outperformance came in 2008-2009.

"I would say just 90% plus of the money going into large funds is setting up things for disappointment in the years to come."

Investcorp was set up in 1982 to help investors in the Gulf States invest in companies in the West.It is now an asset manager focused on alterna......................

To view our full article please login

This article was published in Opalesque's New Managers a top-down monthly analysis, news and research publication on the global emerging manager space.
New Managers
New Managers
New Managers

Banner

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. Legal - Court throws out lawsuits related to Fannie Mae, Freddie Mac profits, Insider case by SEC is a step removed from Herbalife itself, SEC grants Citigroup waivers, easing hedge-fund curbs[more]

    Court throws out lawsuits related to Fannie Mae, Freddie Mac profits From WSJ.com: A group of Wall Street investors on Tuesday suffered a blow in their attempts to sue the federal government over their treatment of the shareholders of mortgage finance giants Fannie Mae and Freddie Mac af

  2. Launches - Goldman Sachs Asset Management launches GS Long Short Fund, Western & Southern launching international hedge fund, Lansdowne Partners plans energy hedge fund, RBC Global Asset Management launches new RBC Funds (Lux) - Asia Ex-Japan Fund, PVE Capital latest credit strategy to launch on the Sciens managed account platform[more]

    Goldman Sachs Asset Management launches GS Long Short Fund From Marketwatch.com: Goldman Sachs Asset Management has announced the launch of the Goldman Sachs Long Short Fund, which pursues high conviction investment ideas in global equity markets through a fundamental, bottom-up approach

  3. M&A - Goldman fund takes stake in Caxton, Neuberger Berman acquires Orchard Square hedge fund, Top banks, hedge funds buy Perzo messaging platform for $66m[more]

    Goldman fund takes stake in Caxton From FT.com: Caxton Associates, one of the best known macro hedge fund managers, has sold a 9.9 per cent stake in itself to a fund managed by Goldman Sachs, according to a letter sent to its investors. The investment in Caxton, which manages close to $8

  4. Unconstrained bond funds: Where hedge fund strategies meet mutual funds[more]

    From CNBC.com: For all the talk and buzz around indexes, or passive investing, the next big thing for bond mutual fund investors may be strategies that are the exact opposite. The rapid growth of "unconstrained bond funds" has been thrust into investor spotlight given last Friday's stunning news tha

  5. Service Providers - Aequitas Capital launches exclusive provider network for independent RIAs[more]

    From Insurancenewsnet.com: Aequitas Capital, a diversified financial services company, has launched the Aequitas Financial Services Network (AFSN), a singular member network of select product and service providers who offer diverse yet complementary capabilities designed to empower Registered Invest