Monday, 1 September 2014
Last updated 3 days ago
May 4 2011 | 12:02pm ET
Small can apparently still be beautiful, at least to institutional investors who are reported to be taking a closer look at smaller hedge fund managers.
"Over the next 10 years we will see a significant increase in the percentage of pension plans investing a meaningful percentage of their hedge fund portfolio away from the largest managers to small and mid-sized managers,” says Doug Rothschild, managing director of Agecroft Partners.
Agecroft believes the shift will happen in part because managers of smaller funds are more “nimble.”
It may also happen because small funds have been generating big returns: hedge funds managing under $50 million returned an aggregate 13.1% on an annualized basis in the 15 years to December 31, 2010, according to Hedge Fund Research. For funds managing over $1 billion, that number was 11.62%.
Smaller funds also outstripped the 10.23% annualized return of the HFRI Fund Weighted Composite index for the same period.
No wonder, then, that pensions like the California Public Employees’ Retirement System and the New Jersey Division of Investment are looking at smaller funds. According to Pensions & Investment, one corporate pension fund has put $150 million in a fund of funds that invests in emerging minority- and woman-owned hedge funds.
Agecroft Partners expects pensions to follow the example of endowments, which have ceased to view hedge funds as a separate asset class—many leading endowments and foundations are invested primarily in alt asset managers, including large allocations to mid-sized hedge funds.
Aug 25 2014 | 11:21am ET
As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…
Commodities/Futures magazine launched at the precipice of a revolution in the futures industry—really a revolution in the idea of risk management—that would move it from a small niche industry to ...