Survey: Family Offices Embrace Hedge Funds, PE

Jun 15 2011 | 10:39am ET

Single-family offices have warmed to hedge funds, according to a recent survey by the Rothstein Kass Family Office Group.

The company polled 151 executive directors of single-family office operations and found 85% are currently invested in hedge funds while roughly half report active private equity sector investments.

According to Rothstein Kass, the mean investable assets of single-family offices stand at roughly $416 million in 2011, up from about $236 million in 2010.

Almost all the single-family offices polled in early Q1 2011 relied on external money managers, while roughly 22% also had in-house capacity.

A full 90% of the directors polled were considering additional investments in hedge funds this year. The most popular strategies, according to Rothstein Kass, were long/short equity (53%), distressed (49%), arbitrage (33%), managed futures (25%), and global macro (25%).

On the private equity side, the survey showed 70% of respondents planned increased allocations in 2011. In terms of investment preferences, 59% are likely to target established companies, 39% mezzanine financing, and 32% second-round financing.

The results of the survey have been published as “Raising Capital from Single-Family Offices—Considerations for Financial Firms,” co-authored by Forbes Insights and Russ Alan Prince.


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