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From Kirsten Bischoff, Opalesque New York: There has been extensive coverage of the fund of hedge funds (FoHFs) industry over the past few months as many of these vehicles have struggled to gain back investor assets. More often than not media coverage has focused on the "imminent death" of fund of funds vehicles, predicting their extinction - when in fact, fund of hedge funds remain the biggest investors into the hedge fund industry.

Many FoHFs have taken this time to restructure their business models to more accurately reflect the needs of the investor base they are targeting for the future (the large institutional investors slowly expanding their hedge fund exposures). This "rebirth" of the FoHFs sector may finally be underway as BarclayHedge reported May 2010 asset flows marked the third month of inflows for FoHFs (+$26m) and the first month where FoHFs could claim more asset inflows than single strategy mangers.

Opalesque recently had the opportunity to speak with industry veteran Rachel S.L. Minard, about the changing paradigm in the fund of hedge funds industry. Minard joined Optima Fund Management a few months ago as a Partner and Executive Managing Director with the charge of building and managing the 22-year old firm's global institutional business.

Q: What is the paradigm shift that has taken place in the fund of funds industry? Rachel: Originally, funds of hedge funds were designed to diversify a portfolio a......................

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