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>>From Kirsten Bischoff, Opalesque New York:
Funds of hedge funds (FoHFs) have continued to suffer from an outflow of assets while single strategy managers have started securing net inflows (TrimTabs estimated FoHFs lost $17.4bn over 1Q2010), however this portion of the industry may be nearing an inflection point to recovery.
Managers of FoHFs, still a large channel in Europe for hedge funds investing, have renewed their focus on investment idea generation, strategy reallocation and the launching of new funds, after focusing on downsizing, restructuring, and resolving liquidity and suspension issues in 2009, reported Fitch Ratings in a recent research report.
These changes, in addition to embracing a role as advisory/consultant-specialist for many of the institutional investors looking to invest directly into single strategy managers, may see FoHFs start securing more assets.
"The FoHFs that remain understand that the sales pitch has changed - it is not about offering access to the best managers, it is a different sell and different product," says Andrew Saunders, Director at New York-based prime broker and fund service provider EFX Prime Solutions. "FoHFs managers need to be able to explain their world view and how it is reflected in the portfolio managers and how it should be reflected in their client's portfolio."
During Och Ziff Capital Management Group's recent quarterly repo...................... To view our full article Click here
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