Like most hedge funds, BlueCrest Capital Management's listed fund of hedge funds has badly underperformed the broader markets.
The AllBlue Fund is up 4% over the past 12 months, Oriel Securities, which has begun to cover the London-listed vehicle, reports. And Oriel isn’t impressed.
The firm calls that return "disappointing" and gave AllBlue a negative recommendation.
"Over the last three years, returns have been more modest, with the NAV rising by only 20% since September 2009. We think that relatively low volatility in markets has been a factor in the lower returns delivered," Oriel wrote. "Over the past year, the NAV has risen 4%, ahead of the HFRX Global Hedge Fund Index, which has been flat."
Still, Oriel said that the fund, which invests in six underlying BlueCrest funds, "warrants further research and stands out in terms of its relatively high market capitalization (£818 million) and relatively narrow discount."