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New Managers March 2019

MARKETING CHALLENGE: Frame it: painting a picture investors want to see

 

Frame It- Painting A Picture Investors Want To See

Hedge fund investors and marketers seem glad to let go of 2018 and its disappointing finish, down 3.41%, a marked decline from 2017's 11.99% gain. And yet, 2019 markets started the year with an upswing, reflecting the hope that springs eternal in capital raising.

Alternatives managers will face the spring season with a renewed enthusiasm for the themes that underpin all their sales efforts: diversify, achieve non correlation to other asset classes, and reduce portfolio risk overall while adding value. However, focusing on generalities and the same old, same old sales pitches will not likely yield the best results. It seems a far better plan to zero in on investor's fears, concerns, and topics of interest in an effort to win them over.

Successfully wooing investors means hitting on themes that are of key interest and structuring the sales pitch to ask and answer the relevant issues they have indicated are top of mind.

In February, Preqin released the Preqin Alternatives in 2019 report, which provides a wealth of data across alternatives sectors. Investors have spoken, and their wishes are clear as to what they want to hear about in investment discussions in the coming year. Let's take a look at several highlights from the survey roundup. THE DIVERSIFICATION EFFECT REMAINS IN FORCE Preqin: 79% of surveyed investors intend to maintain or increase their level of allocation to hedge funds over the next 12 months Despite the disappointing returns hedge funds offered in 2018, investors will continue to hold hedge funds.

Long valued for offering a buffer against risk, hedge funds will attract investors in 2019 as volatility appears to be on the rise. The diversification construction might include funds with exposures across and within asset classes, or with debt holdings at varying maturities.

In equities-based funds, varying global versus domestic equities, large, medium and s......................

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This article was published in Opalesque's New Managers a top-down monthly analysis, news and research publication on the global emerging manager space.
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