Thursday, 24 July 2014
Last updated 11 hours ago
Mar 22 2013 | 11:19am ET
The inexorable march of pension funds into hedge funds has slowed, as the industry's earliest backers returned to the fore during a difficult period.
Family offices and high net-worth investors account for 54% of hedge funds' investor base, according to an Infovest21 survey. Pensions make up just 8% of that base.
Family offices actually increased their share of hedge fund investments compared with 2010, Infovest said. Foundations, which make up 3% of the industry's investor base, also increased their share.
By contrast, all other types of investors saw their share fall. Funds of funds now account for 13% of the investor base, financial institutions 11% and sovereign wealth funds for 3%.
As the industry returns to form and the economy begins to grow, those investors are expected to add to their hedge fund investments. Infovest President Lois Peltz said that high net-worth investors and family offices will see their share drop to 49%, while private funds will rise to 15%, pensions to 9% and foundations to 4% over the next year. Financial institutions are expected to hold at about 11%, while SWF fall back to just 1.7%.
The Infovest Manager Snapshot Survey also shows that the average hedge fund has 110 investors, that 90% posted performance gains last year, and that fees are falling. The average management fee was 1.5% and the average performance fee 18.2%; 19% of hedge funds lowered the former last year and 10% the latter.
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…