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By Benedicte Gravrand, London:

Whoever was in or visiting the funds of hedge funds (FoHFs) industry in Switzerland late last year might remember the consternation of the participants, as the majority of FoHFs there had lost around 30% of their assets from negative performance and heavy redemptions, had locked funds up or attempted to restructure them, and had felt the ripple effects of the Madoff affair.

But the situation is starting to stabilise, and indeed, may even be looking up.

Record outflows in Swiss FoHFs come to standstill, research centre says large hedge fund draw-downs good entry levels According to a report that has just been issued by ZHAW School of Management and Law (Winterthur, Switzerland), and ABS Investment Management, a US-based FoHFs, the number of Swiss registered funds of hedge funds (FoHFs) grew to more than 300 (to Dec-08) in 4 years.

But net asset outflows for 2008 eroded all the net inflows achieved in 2007 and peaked in January-09 to $7.2bn. However, outflows came to a standstill in March-09. Total AuM of Swiss registered FoHFs now amount to more than $15bn.

The report also notes an acceleration of private investors’ exodus, leading the Swiss FoHFs industry to a more institutionalised investor base – which may in turn lead to a demand for greater transparency.

The report, entitled “The year after: structure, evolution and performance of Swiss FoHFs” (......................

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