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Alternative Market Briefing

Asset managers could gain from family offices rediscovering the pooled fund

Monday, October 10, 2011

From Precy Dumlao, Opalesque Asia:

Pooled investment vehicles are regaining popularity with family offices and this emerging trend offers opportunities for asset managers, according to research and data analyst firm Cerulli Associates. But at the same time, Cerulli warned asset managers that the asset class also provides some bumps along the way, so caution is very important.

Rob Testa, senior analyst and HNW subject matter expert commented, "While these vehicles are not new, they have regained traction within the family office space as these firms bring more investment vehicle expertise in-house to save costs and create more options for clients." Investopedia defines pooled investment vehicles as a fund aggregated by investors to benefit from economies of scale that allow for reduced trading costs per dollar for investment, diversification and professional money management.

The strategy provides many advantages that make the asset class ideal for many investors. Lately, management fees charged by pooled fund managers have been declining as competition increases.

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