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Bailey McCann, Opalesque New York:

Endowments and foundations are taking a hard look at their investments and in some cases, hedge funds may not make the cut, according to a new survey from Boston-based investment consultants NEPC. NEPC published the results of its second quarter Endowment and Foundation Poll, which showed that twenty-four percent of respondents cited having zero exposure to hedge funds - a significant increase from the Q2 2014 NEPC Endowment and Foundation Poll which asked the same questions. In the 2014 survey, only two percent of respondents reported having no exposure to hedge funds.

39 percent of respondents in the Q2 2014 Poll had 11-20 percent of their portfolio allocated towards hedge funds, but in the Q2 2016 survey, only 23 percent had the same allocation.

"Investors are in a bit of a holding pattern while they consider where to put assets," Cathy Konicki, Partner and Head of NEPC’s Endowment & Foundation Practice Group said in an interview. "In some cases it looks like endowments and foundations have come out of hedge funds and are considering other asset classes like private equity or real assets."

Konicki says that hedge fund performance has these investors looking closely at their portfolios and considering the fees and other costs associated with hedge fund investments.

A quarter of survey respondents have asked for reduced fees or have been offered reduced fees by their hedge fund managers within the pas......................

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