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Bailey McCann, Opalesque New York:

Family offices are key sources of capital allocations for hedge funds. Peter Fletcher of the Parly Family Office has been investing in hedge funds for several years. Fletcher, now based in Switzerland was recently interviewed by Matthias Knab for Opalesque TV.

Fletcher explains that even before the financial crisis of 2008 many smaller investors and family offices were being edged out of investing in hedge funds by larger institutions. "In 2000, we saw more and more money coming in from pension plans, endowments, everybody wanted to be like Yale and Harvard and they hired consultants and consultants would go just to the big fund of funds. So, we saw ticket sizes going up and up, a hundred turned into a billion and that was sort of the size in the hedge funds and saw a complete change and it emanated or -- stopped in -- at the start of 2007."

According to Fletcher, now he finds returns through managed accounts and a select few hedge fund managers that he has a long, pre-existing relationship with. For him the traditional hedge fund model fell apart during the financial crisis and remains broken today.

"I think the two and twenty model is dead. We do not pay two and twenty and nor do a lot of other families that we invest with pay two and twenty. In addition, we do bespoke funds. That is more complex strategies that we could not do ourselves,"......................

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