Survey: Institutional Investors Like Activists

Apr 8 2014 | 1:09pm ET

Good news for the Bill Ackmans of this world:  a new survey shows institutional investors are bullish on hedge fund activism.

Novus polled 65 alternative and institutional investing professionals during the PartnerConnect/HedgeWorld East Conference in New York in March and found that 78% believe activism drives shareholder value, 94% believe activism will become increasingly popular and 70% were prepared to invest in activist funds.

Respondents were also queried about succession and 77% agreed hedge funds would be negatively affected when their founders step back or retire in the coming years.

A full 88% of respondents believe the industry will continue to institutionalize and that that will help them maintain long-term viability.

According to 61% of the investors polled, pensions are under extreme pressure, post-financial crisis, to generate greater returns as opposed to focusing on preserving existing capital.

“With institutional investors under increasing pressure to add value and deliver returns, we’re not surprised to see unconventional investment strategies like activism growing in popularity and a great uptick in allocators willing to employ them,” said Basil Qunibi, CEO and founder of Novus, a portfolio intelligence and analytics company based in New York.

Respondents included hedge fund, private equity, family office and pension fund managers as well as other institutional investing professionals.
 


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