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From Kirsten Bischoff, Opalesque New York: In a recent Celent report concluding a study of trends in hedge fund administration further evidence of the potentially immense increase in institutional assets was clear. A review of the finer points of the study, as well as conversations Opalesque had with Andrew Dougherty, COO of Alternative Investment Fund Services at BNP Paribas Financial Services and Robert Schaeffer, Managing Director of Equity Fund Services found that administrators are seeing a subtle shift in hedge fund manager demands, all focused on securing what is likely to be a large influx of future investments from these demanding investors.
Observing same client trends: reaching alpha goals
The Celent study noted the growing importance of portable alpha, which has seen many fund managers looking at options such as OTC derivatives, and the development of hybrid vehicles. Hybrids are defined by the report as “the practice of carving out a discrete amount of capital to be invested in illiquid private instruments only.” By offering exposure to both public and private investments fund managers are able to shift gears more easily depending on market cycles, a capability magnified by the market shifts of the past year. Likewise, hybrids are attractive to investors as they allow diversification in both spaces without separating assets or requiring multiple managers and additional fees.
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