Hedge fund managers hoping to attract institutional investors should tailor their pitches to the clients they’re approaching, according to a representative of Texas’ $105.3 billion Teachers Retirement System.
W. Russell Guinn, a TRS portfolio manager, told delegates at this year’s GAIM conference in Monaco that funds employing a “scattergun” approach to attracting investors will fail.
"If you don't customize your approach to the needs of the investor, it will probably get ignored," HFMWeek quotes Guinn as saying during a panel discussion on hedge fund size. "Do a little bit of research and you will get far further." Guinn also told participants that roughly a third of TRS’s investments came from direct approaches and targeted pitches from managers.
The TRS portfolio manager sent some mixed signals to smaller managers, saying that he preferred boutique shops in theory, but that the TRS’ biggest relationship was with one of the world’s largest hedge fund managers, Bridgewater.
HFMWeek says Guinn admitted that personal relationships with fund managers can cloud portfolio judgment, especially when the TRS is the main investor in a fund, or when it’s a question of termination. He says it’s something the Texas system tries to avoid.