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Alternative Market Briefing

De Francisci: How to conduct due diligence using backgammon, Part 2

Thursday, August 07, 2014

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Benedicte Gravrand, Opalesque Geneva:

Giovanni de Francisci runs the Petschek Family Office out of Monaco. He describes his unconventional views on manager selection, the state of the hedge fund industry and investment risks, using various colorful similes during a recent Opalesque TV interview with Matthias Knab. Here are some of his views.

A very unique strategy for selecting managers "What makes me very unusual with regards to selecting hedge fund managers is that I don't have the typical conventional investment criteria, which is that you must have a minimum track record, minimum assets under management, or an investment strategy that I understand off the bat," he says when asked about his selection criteria.

De Francisci has invested in startup funds, and sometimes even in managers with no official track record and no assets under management. He has "seeded hedge funds on the barrel," he says, and will consider seed investments before a 12-month track record is completed. Making an investment in such a manager implies an "intimate relationship," according to him.

He does do due diligence – his way. He will ask the managers if he might stay at their place while he travels, and the managers are always very happy to oblige and get to spend time with an allocator. De Francisci gets to see how the manager lives and h......................

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