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From Kirsten Bischoff, Opalesque New York:
Institutional investors need to boost returns in order to meet funding requirements, have initiated additional risk management programs, and are now looking to certain hedge fund strategies and other alternative investments over traditional equity and fixed income allocations in order to make up losses from the financial crisis. With 63% of institutional investors looking to increase alternatives allocation in the next 1-2 years, a new survey from Bank of America Merrill Lynch Capital Introductions Group (as well as Alternative Investment Institute at Quinnipiac University and the Connecticut Hedge Fund Association), offers hedge fund managers new hopes for asset-raising in the new year.
“This corresponds to a trend that the BofA Merrill Lynch Capital Introductions team has
seen playing out since the market crisis, where plan sponsors have been de-risking their portfolios via reductions to traditional equities and re-investing active risk dollars in fixed income and alternatives,” comment the report’s authors.
The survey, which included 107 investors (heavily US, but including firms in EMEA and Asia and representing a total of $2.1tln aum), shows that institutional investors are becoming more comfortable with the idea of increasing their alternatives allocations, also revealed that the biggest stumbling block to actually securing those allocations is “the belief...................... To view our full article Click here
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