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Robert Kaplan From Kirsten Bischoff, Opalesque New York:
"It is not what a manager can do for you, it is what a manager can do to you." This philosophy, integral to the manager selection process at $23bn fund of funds firm Permal Asset Management, is the driving force behind the firm’s extreme diversification across hedge fund managers and strategies. With over 10,000 hedge funds in existence focusing on the top 5% of managers allows a field of 500 funds, explains Robert Kaplan, CIO at Permal during a recent Opalesque TV interview. "We are using 165 to 170 managers. I think there is plenty of talent to choose from, especially when you are investing on a global basis as we are. You can build a quality portfolio and still have the diversification benefits."
The firm, which is just shy of its 40th anniversary, also holds one of the largest separately managed account platforms, which is over $6bn in assets. The liquidity benefits of holding assets in separately managed accounts were most recently evident in 2008, and active management capabilities through dynamic asset allocation have allowed the firm to navigate the markets post financial crisis. For example, most recently the investment team at Permal was able to add to the firm’s Japan exposure after that market sold off 20% following the tsunami. "If you are just invested in commingled vehic...................... To view our full article Click here
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