Institutional Investors Overwhelmingly Plan Hedge Allocations

Jul 18 2014 | 11:42am ET

Hedge funds could be in line for a windfall of new institutional capital in the second half, according to a Credit Suisse survey.

The bank’s mid-year Hedge Fund Investor Sentiment Survey shows that 97% of institutional investors plan to be highly active in making allocations during the second half. Credit Suisse’s Annual Global Investor survey earlier this year showed only 85% expecting such activity in the first half.

“The high percentage of respondents with strategic intention to actively allocate to hedge funds in the second half of this year could reflect a prolonged due-diligence process, in response to high levels of market volatility back in March/April,” Robert Leonard, global head of capital services, said. “Regardless, it does seem clear that institutional investors remain committed to hedge funds, as many see current equity and bond market valuations as high and are looking to further diversify their portfolios.”

Institutional investors are particularly hungry for event-driven funds, with 56% identifying the strategy as a high priority. Equity long/short funds, especially those with a fundamental bent, are favored by 41% of respondents. Emerging market equities have seen a rebound in interest, with 20% naming it as a focus, while commodities strategies have gone from negative interest to a slight positive. Global macro continues to decline in investor eyes, with just 17% admitting to an appetite for the strategy.

Investors still plan to redeem from commodity trading advisors and managed futures funds.

Credit Suisse said that 284 global institution investors, with some $544 billion in hedge fund investments, responded to the poll.


In Depth

Q&A: Brevan Howard’s Charlotte Valeur Talks Strategy

Sep 18 2014 | 11:18am ET

Charlotte Valeur chairs the board of Brevan Howard Credit Catalysts, an LSE listed...

Lifestyle

Hedgies Rock Out For Children's Charity

Sep 15 2014 | 8:40am ET

It's that time of year again—when hedgies trade in their spreadsheets for guitars...

Guest Contributor

Volkered: How Financial Sector Reforms are Creating Opportunities for Hedge Funds

Sep 16 2014 | 11:28am ET

New regulations have dramatically curtailed proprietary trading activity in investment...

 

Editor's Note

    Get A Sneak Peak Of The Alpha Pages

    Aug 25 2014 | 11:21am ET

    As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…

 

Futures Magazine

September 2014 Cover

The London Whale: Rogue risk management

Credit default swaps brought down the London Whale and cost JPMorgan $6.2 billion. Here is how it happened.

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.