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by Beverly Chandler, Opalesque London:

South African investment firm, Novare, has just published its 2011 Survey of the South African hedge fund industry. The firm describes the survey, entitled Novare Investments Hedge Fund Survey 2011 as an overview of the South African hedge fund industry and says it provides information on local hedge funds. "The aim of this survey is not to review the historical investment performance, but rather to focus on the size and demographics of the industry, the strategies used, leverage levels and available capacity" the firm explains.

Some 65 management companies took part in the survey on a voluntary basis, answering questions in a questionnaire sent to South African hedge fund managers, Only funds domiciled in South Africa, rand denominated funds classifying themselves as hedge funds, are included in the results of the survey.

The survey excludes South African absolute return funds as well as unit trusts that utilise derivatives in order to obtain partial hedging and/or leverage. Although the authors acknowledge that this has become a more difficult distinction to draw in terms of similarity with how some of these funds execute their trading strategies.

The study did not include funds of hedge funds in an attempt to reduce the risk of double counting. Key findings of the survey included:

• South African hedge fund assets remain above R30 billion.
• 33.7% of industry assets are managed by companies with total hedge......................

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