Saturday, 25 October 2014
Last updated 12 hours ago
Mar 21 2014 | 9:59am ET
The majority of institutional investors polled by Deutsche Bank plan to increase their allocations to hedge funds in 2014 and almost half intend to add more than $250 million.
The bank's Hedge Fund Capital Group surveyed 400 hedge fund investors representing over $1.8 trillion in assets for the 12th annual Alternative Investment Survey, released in February.
More than 50% of respondents added to their hedge fund allocations in 2013 and a full 80% felt those investments—which returned a weighted average of 9.3%—had met or bettered expectations. For 2014, 63% of respondents and 79% of institutional investors are targeting returns of less than 10%. Long/short equity and event-driven are the most sought after strategies this year.
The survey also found the percentage of respondents embracing a risk-based asset allocation approach has increased from 25% in 2013 to 39% this year. This could also be good news for hedgies, as a risk-based approach “effectively removes historical constraints on the percentage allocation to absolute return strategies, allowing equity long short managers to compete with long-only and fixed-income absolute return funds to compete within the overall fixed income risk budget.”
Institutional investors today account for two-thirds of hedge fund assets compared to one-third before the 2008 financial crisis.
Sep 22 2014 | 4:15pm ET
"I tell people that everybody likes good news and so if you have good performance that’s wonderful,” explains Mike McKitish of Peddie School's endowment, “but it’s the people that want to talk about the bad news or where they drifted and how they came back and how they stayed to their discipline…” that he wants to hear from. Read more…
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