Thu, Nov 12, 2026
A A A
Welcome Guest
Free Trial RSS pod
Get FREE trial access to our award winning publications
Industry Updates

Poorly performing hedge fund face with liquidations and restructurings

Monday, June 20, 2011

Nigel Sidebottom
Opalesque Industry Update – Hedge funds that have been underperforming the last couple of years are facing liquidation. Most of these are investment trust hedge funds that were launched as absolute return strategies and that have failed to deliver their promised alphas.

A report has quoted Numis Securities, which said that the decision to liquidate underperforming hedge funds should be expected.

Numis said, “Numerous listed funds of hedge funds have wound up over the past few years and we believe that further consolidation is needed. In addition, listed funds are facing increased competition from UCITs funds, especially in long/short equity strategies.”

Investors are now heading towards open-ended funds under the European UCITS III director where they can move their money more frequently and the risk of discounts is nil. Nigel Sidebottom, the deputy chief investment officer at Premier Asset Management and the manager of the Premier Enterprise fund, commented that many investors have lost money from poorly performing hedge funds.

Amongst those facing liquidation is Cazenove Absolute Equity, the board of which will vote this week to determine if the fund will continue operating under its present set up. Cazenove’s board is proposing a change in its investment policy. Performance plunged in 2009 and 2010 and it has lagged its counterparts.

It was also reported in April that Trafalgar Asset Management is liquidating its flagship fund, the Trafalgar Catalyst fund as a result of "material" investor redemption requests.

According to Fund Web, shareholders of Dexion Equity Alternatives voted last week to restructure the fund and change the trust’s investment policy from a global fund of hedge funds to a hedge fund focused in American equity long/short hedge funds.
Precy Dumlao

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Previous Opalesque Exclusives                                  
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Opalesque Exclusive: DACH institutions push alternatives to 32.3% of portfolios as hedge funds make a comeback[more]

    Matthias Knab, Opalesque for New Managers: Institutional investors in Germany, Austria and Switzerland now hold almost a third of their portfolios in alternative investments, and they are more confident than ever in

  2. KRX chief courts CalPERS for bigger bet on Korea[more]

    Korea Exchange Chairman and CEO Jeong Eun-bo held talks with California Public Employees' Retirement System, or CalPERS, to promote greater investment in South Korea's capital markets, the bourse operator announced Wednesday. Jeong met with CalPERS Chief Investment Officer Stephen Gilmore.

  3. 755 Unicorns, $8 Trillion: Fifth Era maps the autonomous digital economy[more]

    Matthias Knab, Opalesque for New Managers: Fifth Era Partners, a specialized asset manager focused on the convergence of Internet, AI/Agentic and Blockchain technologies, has released the findings of its 13th Bia

  4. Opalesque Exclusive: "Enough beta plays" - how Fasanara builds an alpha-only multi-strategy platform[more]

    Matthias Knab, Opalesque for New Managers: Most multi-strategy funds promise diversification. Fewer can explain why their return streams should stay independent when markets turn. In an Opalesque SkillsLab investor

  5. Opalesque Exclusive: Governance, Scale, and Boutique Resilience in a Consolidating Hedge Fund Industry[more]

    Matthias Knab, Opalesque for New Managers: The hedge fund industry has undergone significant consolidation in recent years, with capital increasingly concentrated among large multi-strategy platforms. Yet boutique m